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Table of Contents
    Front Cover
        Front Cover
    Table of Contents
        Table of Contents
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    Back Cover
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Full Text

Io. 5
NO.. z5,

HOUSE OF COMMONS, February 13, 1947 [Extracts]

The President of the Board of Trade (Sir Stafford Cripps): This Bill is
designed to provide methods for enabling private enterprise industries to
bring themselves up to date, and to make themselves as highly efficient in
the production and in the distribution of their products as is possible.
One of the defects most obvious to anybody who examines our industries
is the inequality of standard between different industrial units. Some of those
units are large enough and progressive enough to provide themselves with
all the services essential to modern industrial development and progress-in
the fields, for instance, of research, design, statistics, organization, personnel
training, and all those other matters which add so greatly to the efficiency
of industry. Other smaller units, very often, have not the resources to do
these things by their own effort, and in many industries the units which
have not those resources, in fact represent a very large proportion of the
total output of the industry.

In modern circumstances, the efficiency of the industries of the country
is not the concern merely of those whose capital is invested in the industries,
or even of those who contribute their work to those industries. The people
of the country as a whole are deeply interested, because we simply cannot
afford to waste any of our manpower or our other resources, through ineffi-
ciency, wherever that inefficiency may be. Indeed, as we all realize now,
our standard of living depends upon the efficiency with which we can
produce in all the many units of production throughout the country, and
the amount of hard work that is put into that production. It was because
of the obvious need to do our utmost to increase the productivity of our
industries, both in quantity and in quality, that, immediately this Govern-
ment came into office in the autumn of 1945, we initiated inquiries into the
efficiency of those industries, particularly those which supplied consumer
goods, and which had, consequently, suffered from concentration or, indeed,
in some cases, practical eclipse during the war. We did that in order to get
the best possible advice on how we should set about assisting to improve
these industries, and helping them, not only to get back to their former
prosperity, but to become even more efficient than they had been before.
I should like to remind the House of the composition of the working
parties which were then set up, because I think it has a considerable bear-
ing upon the provisions of this Bill. As to two-thirds of their personnel,
those working parties consisted of representatives of the industry that was
being inquired into, one-third being employers and one-third employees.
The remaining third consisted of persons not directly connected with the
industry, but having some professional qualifications in a field which could
be particularly helpful to the industry-economists, accountants, engineers,
architects, designers. These various qualifications were to be found among
the so-called independent members; and they were able, therefore, to give

House of Commons, February 13, 1947

the advantage of their particular technical knowledge to the working party
as a whole, and, also, to have regard to the consumers' point of view.
It is, perhaps, surprising to some people, in view of the difficulties that
existed, as we know, between the different elements in industry, that, in the
great majority of the matters affecting those industries that have been in-
quired into, the working parties have reached unanimous conclusions-it is
really a very remarkable thing-despite the obviously different approaches
of different members to the problems which came under examination.
Perhaps, when one looks at it a little more closely, it is not so much to be
wondered at that these groups of sensible and intelligent men and women,
confronted with the detailed facts and difficulties of the various situations
in industry, should have agreed on the measures necessary to assist industry
to get out of those difficulties. There has certainly never before, so far as
I am aware, been such an opportunity for so thorough a review of the
circumstances of various industries, and for the examination, too, in many
cases, of their counterparts in other countries. As the House will be aware,
a number of delegations have gone from the working parties to visit indus-
tries in various other countries of the world, particularly the United States
of America, but also including Sweden, France and Switzerland, and other
countries, so that they might be well informed on the comparative circum-
stances of those other industries, before arriving at their final recommenda-
tions. It is right to say that these working parties have done a great service
to industry and to the country, and have produced reports which are really
a mine of information, and upon which we can, I hope, base the future
progress of the industries that have been inquired into.
Many of the recommendations that have been made in these reports are,
of course, already being acted upon either by the industry itself, or by some
Government Department, or other body concerned. But, as appears from
the reports, there is a need, in many of these industries, for some new type
of central body to undertake the execution of the various recommendations,
to see to their supervision, and to secure the production of certain common
services for the industries, which, as I have mentioned, are sometimes avail-
able to large organizations, but not to the smaller organizations.
I want to make it clear that this Bill deals with only one aspect, and
that is this general aspect, of the working parties' reports. It does not
pretend to deal with all the many detailed recommendations that have been
otherwise put forward. Great importance is attached to many of those
recommendations and we are seeing to them in other ways, through other
channels. All that has been done, and is being done, for instance, to help
the cotton industry is a good example of how other recommendations are
being followed up. To give one other example, the problem of new
machinery for the hosiery industry is a matter of great importance to that
industry, which is being followed up through other channels. In following
up these other recommendations we have found that organizations such as
the Cotton Board have been of the greatest help, and we are confident that
similar bodies in other important industries would be equally helpful, both
on the general approach and on following up particular lines of action

Industrial Organization Bill [Sm S. CiIPPs]
Running through the principal reports of the working parties, is a
recommendation that some central body should be set up. The suggested
composition of that body varies in different cases, as one would expect,
according to the incidences of different industries, but in all cases the prin-
ciple is accepted, that both employers and employees must be represented
on the body, and that there should be some element, be it large or small,
of outside membership. In practically all cases, it is also recognized that
such a body must have some means of financing itself. It is no good cre-
ating a body of that kind, setting it up to do a job, and then asking it to
rely merely on the voluntary subscriptions of those who are keen on the
subject. The essence of the idea put forward is that the organization should
cover the whole industry, and, therefore, everyone should contribute to its
support, as was done in the case of the Cotton Board and in some other
organizations set up for other purposes. As to the functions which such a
body should perform, that, of course, depends upon the particular industry;
the suggestions put forward differ, though there are a number of common
suggestions which run through the whole of the recommendations.
I have said on earlier occasions that the policy of the Government is to
assist as far as possible the implementation of the recommendations of the
working parties. It is no use, in our view, and I am sure the House will
agree, setting up inquiries, and asking distinguished and hard-working
people to take part in them, if we are going to disregard the recommenda-
tions when they are made. This Bill is designed to produce the organiza-
tional structure for industry, which will best accommodate the recommenda-
tions of most of the working parties. There may still be some people who
fear that this Bill is, in some occult way, an introduction of nationalization
of industry. It is, of course, nothing of the sort. If and when we believe
it to be in the national interest to bring other industries under national
control or ownership, we shall act directly, and not by some ingenious
subterfuge. This Bill is designed to reinforce and strengthen private enter-
prise industries, so that they can make the best possible showing in the
national interest. If conditions were such in any industry today that
industrialists were not prepared for this kind of common effort to assist
themselves in arriving at the highest possible degree of efficiency, it would,
indeed, be a very bad look out for that industry and for the country. That
is certainly not the deduction which is to be drawn from the conclusions
arrived at by the leaders of both sides of industry, who have inquired into
these matters in the working parties.
Before coming to the detailed provisions of the Bill, I should like to
say a word or two about the point which has, perhaps, been exercising the
minds of some persons in industry. It has been suggested that these func-
tions, which are proposed by the Bill, for development councils might be
carried out by existing trade associations, and that, therefore, the new body
is not necessary. Trade associations are, essentially, bodies representing
employers only, just as trade unions represent employees only. For the
purposes which we have in view, and which the working parties had in
view, it is essential, as was pointed out, that both employers and employees
should be represented on these development councils. It is, therefore, out
of the question for anyone with an up-to-date realization of the development

House of Commons, February 13, 1947

of relationships in industry to imagine that any body could be acceptable
for such a purpose, unless it included both employers and employees. That
really emphasizes the fact that the development councils will not in any
sense supersede trade associations, any more than they will supersede trade
unions. They will be the forum in which the two bodies will meet, and
no doubt much of the work they do will be done through their communi-
cations with those other bodies. They will provide a common meeting and
deliberating ground for the topics which fall within their ambit, and the
bodies of employers and employees will continue, as before, to carry out
their own particular functions.
It is also generally agreed that it would not be wise or practicable to try
to change over the machinery of the joint industrial councils to the purposes
which this Bill has in view. We are anxious to keep production and devel-
opment matters separate from negotiations as to wages and conditions of
work. For that reason, such matters as wages and conditions of work have
been expressly omitted from the list of activities suggested for the develop-
ment councils, so that they cannot impinge on what is properly the func-
tions of the negotiating bodies as between employers and employees. This
is very largely the distinction that was drawn during wartime between the
joint production councils and the bodies which were negotiating wages and
other matters. It may, however, be very advantageous in some circum-
stances to have close liaison between the development councils and the
joint industrial councils. They may both help in their work, and for that
purpose we should make it a practice to appoint two members from the
joint industrial council to any development council which is created.

I should next like to deal with the Government's general approach to
this problem of the organization of private enterprise industry. We believe
that there must be the greatest degree of flexibility in applying any organ-
izational pattern. Industries differ enormously in their circumstances, and
what is advisable for one small and easily defined industry, is, obviously,
not necessarily desirable for some other great industry which spreads itself
over a great many products. This merely imposes the necessity of the Bill
in its present form being an enabling Bill. I do not suggest that all indus-
tries will prove suitable to be dealt with under this Bill. That is not our
idea at all. Already, as the House knows, other forms of organization have
been developed, in, for instance, the shipbuilding industry, the motorcar
industry and so on. The fact remains that there is a large number of indus-
tries to which, it seems to us, this flexible form of organization might well
be applicable.
It would, clearly, be out of the question, if we are to make any real and
rapid progress in dealing with industry, to do it by means of a separate Bill
for each industry. That would be postponing for years the setting up of a
central organization for a number of industries which have already ex-
pressed their wishes to have such a body. The process would be far too
long drawn out to be effective, and such a suggestion could appeal only to
those who would rather see nothing of this kind developed. I can under-

Industrial Organization Bill [Sm S. CIPPs]

stand that suggestion being made as a form of blocking opposition. But
as a practical method, if you want to get on with the job, there is no way
of doing it except by an enabling Bill. Of course, an enabling Bill must
be administered with great care and understanding, and the first point of
that understanding is the realization that to do things by compulsion is far
less healthy and less effective than to do them by agreement. Even if agree-
ment takes rather longer-as, of course, it must-it is, in the long run, more
effective. Agreement must, wherever possible, be by both sides of the
industry, and the majority of both sides.
That is why we have inserted provisions in the Bill for consultations
with both parties, employers and employees. If the working parties are
any criterion, it should not be difficult to get a degree of agreement which
will assure the successful launching of such a development council. It is
not our intention to rush into this form of organization for all industries
at the same time, trying to cover the whole complex area of British indus-
try. That is not our idea. But there are certain cases which undoubtedly
call for immediate decision such as, for instance, the cotton industry, in
which the system has already proved itself. There, the Cotton Board have
done a good job indeed, but certain adjustments are required in the light
of experience. It is, therefore, proposed to repeal the legislation-which
never came into operation-for the setting up of a body of this kind, and
to deal with the adjustment of the Cotton Board under an order made
under this Bill. We hope that the benefit of the experience which the Cot-
ton Board have had will be of great assistance to other industries which
are considering the setting up of a similar council. We shall hope to take,
first, those industries where a development council has already been recom-
mended by the working party, and, after consultation with the parties, we
shall hope to arrive at an agreed form for the development council, and
agreement as to what functions they should have and other matters with
which I will deal in a moment.
The House will notice that the list of functions in the First Schedule
which can be performed by the development council is a maximum list,
subject to one point which I shall mention later. But it does not mean
that all those functions will be given to any particular development council.
What functions they have will depend on the needs and desires of the par-
ticular industry, and will be a matter for discussion and, I hope, agreement
with the two sides of the industry. I cannot, and I do not pretend to, give
any undertaking that, in the last resort, in some special case, it may not be
necessary to impose a development council by order, without the consent
of everybody concerned. I hope very much that that will never be neces-
sary, but if it were so, this House, of course, would have complete cog-
nizance of the fact and control of it, because in every case the order setting
up the development council has to be passed by an affirmative Resolution
of Parliament. What, I think, is essential is that we should regard our
industries as integrated teams of producers, not in the light of isolated
units of production, the strongest of which may have all the services neces-
sary, while the weaker cannot have the help which is essential if they are
to reach a high level of efficiency.

House of Commons, February 13, 1947

It is noticeable in the working party reports that the deficiencies that are
pointed out are almost solely connected with matters of common interest
to the industry as a whole, and not to individual firms as such. Research,
education, accountancy methods, salesmanship, and so forth, are all matters
in which there is a common interest in industry, and it is in these matters
of common interest that the development council will be able to help,
though not compel, the individual units in industry. All the powers inthe
First Schedule of the Bill are powers to promote or undertake activities, but
there are no powers to compel anybody to do anything under that Schedule.
The only powers of compulsion are those in the actual Clauses of the Bill,
dealing with the collection of statistics, the registration of persons in indus-
try, and the collection of a levy, if it is authorized. The Bill provides for a
very large measure of co-operation in the matters of common interest which
I have mentioned, a co-operation open to all those within industry and it
also provides a body with which the Government can work in full partner-
ship-which is of great advantage to the Government. I know from my
own experience of the Cotton Board, how invaluable that is when one is
trying to make some kind of advance and progress.
There is one obvious danger which I should mention, because I am sure
it is in some people's minds. Bodies of this kind, which represent the entire
industry, may be liable to try to adopt and encourage restrictive practices
for the industry, practices which would be inimical to the consumer and,
indeed, to the general national welfare. It is for that reason that their
functions in the Schedule are so limited as to exclude any power of impos-
ing restrictions, either on entering into industry or on condition of the
sale of goods manufactured, except in the matter of recommending the
voluntary adoption of quality and other standards, and certifying marks.
If it should become necessary, the Government will take active steps to stop
any such encouragement of restrictive practices by a development council,
even if it meant amending their powers or adopting other suitable measures
which could, be taken. It must be quite clear that such purposes are not
the object for which development councils are to be set up, but if perchance
they should stray into the area of restriction they would be brought back
immediately to their proper function. I do not anticipate that anything
of that sort will happen, but it is something against which we must guard.

With those general introductory remarks, perhaps I may now rapidly
run through the Clauses of the Bill itself. Clause 1 enables certain named
Ministers to set up by Order a development council for any industry, and
there is no definition of the term industry, which covers any form of pro-
ductive activity, but does not cover distribution. It will not be possible,
for example, to set up a development council for the Wholesale Textile
Association or any organization like that. The Clause covers any produc-
tive enterprise, including agriculture. It enables a council to be set up in
order to increase efficiency or production in the industry, to improve or
develop the service which it can render to the community, and to render
such service more economically. The functions of a development council

Industrial Organization Bill [SIR S. CRIPPS]

for this purpose are as set out in the First Schedule. They are the maxi-
mum function, and will not necessarily, each of them, apply to every
development council.
It may be asked why so many Ministers are named. The answer is that
all the Ministers named are responsible for some form of production. The
Minister of Agriculture and Fisheries, the Minister of Supply, the Minister
of Food, the Minister of Works, the Admiralty, the Secretary of State for.
Scotland, the Minister of Fuel and Power, and the President of the Board
of Trade are all responsible for some area of production. Within the area
for which they are responsible, they will be able to apply the Bill. Sub-
section (3) makes provision for consultation with organizations represent-
ing employers and employees.
Under Clause 2, provisions are made for the constitution and member-
ship of the development councils. The provisions lay down that in select-
ing members under Subsection (3) they shall come from three categories
-persons representing employers, persons representing employees, and other
persons being independent of those two elements. There is no definition
of the number of members from each group specified. That is a matter
which is left for negotiation according to the different industries. Clause
3 contains the provision that a development council may provide a register
of persons carrying on business in the industry, but there is no power to
restrict registration. It merely gives the council the power to ascertain who
is operating within that industrial field. If we are to have any kind of
development council which can raise a levy it is obviously necessary that
they should know who are the constituents of the industry.
Clause 4 deals with the question of levies. It enables power to be
given to a development council to collect a levy to meet its expenses, either
from the persons carrying on business in the industry, or persons dealing
with any material used in the industry. That is because it is sometimes
more convenient to raise a levy on raw material, as, for instance, cotton,
than it is on the direct processes of the raw material as it passes through
the industry. The order has to set out the maximum that can be raised by
way of levy, but that does not mean that the development council have to
collect that maximum when the time comes. If I am asked to state the
likely amount of the levy, I can only cite the example of the cotton in-
dustry, in which a levy of 100,000 a year is about one-tenth of 1 per cent
of the value of the industry's output.
Mr. F. A. Cobb (Labor): Too low.
Sir S. Cripps: That may be so, but I am only giving that as a measure, so
that the House may know the figures which we have in mind. If the de-
velopment council wants more money, it can always apply for an amend-
ing order to raise the levy. It is probably wiser to start not too ambitiously,
and to see how things work out, rather than to jump straight away into
a very ambitious scheme.
Mr. Cobb: May I ask the right hon. and learned Gentleman if he will bear
in mind that the most up-to-date of our competitors intend to spend about
two per cent of their net sales, and that if we are to make headway I think
that we shall want something higher than the figure suggested?

House of Commons, February 13, 1947

Sir S. Cripps: I am aware that numbers of large industries spend very
large proportions of their incomes on this wise purpose, but I think that
it would be a mistake to try to launch these development councils on too
grand a scale. The thing is to get them soundly launched, and to let them
direct their own way and find out how great a service they can render,
and if they require higher rates of levy, and the industry would like it
later on, that can be put up. Clause 5 deals with the restriction on dis-
closure of information obtained by members of the staff. Its purpose is to
see that particular information supplied by a firm is kept confidential,
and does not get out to competitors or to persons who may misuse it.
Mr. S. O. Davies (Labor): Since a development council may cover an
industry which is highly developed and another, not so highly developed,
are we to understand that no information which the development council
may get from one firm will be passed to another firm, irrespective of how
advantageous to the second firm it may be?
Sir S. Cripps: No particular information will be passed over without the
permission of the first firm, but general conclusions, drawn from statistical
information, may be circulated throughout the whole industry. It is exactly
the same as with a census. Particular figures are not published, but the
general conclusions drawn from those figures are published. What an in-
dustry wants to know are the general lines of conclusion, and not the par-
ticular statistics of an individual firm.
v*Mr. S. O. Davies: I did not have statistics in my mind. To be perfectly
frank: Are trade secrets enjoyed by one firm not to be disclosed irrespective
of how advantageous they may be to other firms?
Sir S. Cripps: No. The only power which a development council will have
for asking for disclosure of anything is with regard to statistics. They can-
not ask for a trade secret. It would obviously be quite wrong to do that,
while we have the present structure of industry. It will be only possible
to get disclosure of facts of that kind if that is agreed to by the person in
possession of them. There can be no disclosure otherwise.
Clause 7 deals with reports and accounts of development councils. These
have to be rendered annually to the Minister responsible, and he has to
lay them before Parliament. Clause 8 deals with amendments of the orders
setting up development councils, and allows them to be operated or dis-
solved if a development council wishes to cease. Subsection (3) lays down
that at a date not later than the expiration of three years from the com-
ing into effect of a development council order, and at five yearly intervals
thereafter, the Board or Minister concerned shall consult the council and the
organization of employers and employees on whether the council should
continue in being, and, if so, whether variations should be made. That is
inserted in order to make certain that we do not get a useless council, which
merely clutters up the ground, continuing in existence. If it is no good, we
will be able to get rid of it, and, therefore, this periodical review has to take
place compulsorily under the Bill to see that we do not get useless bodies
continuing in office.

Industrial Organization Bill [Sm S. CIaPs)

Mr. David Eccles (Conservative): Could the right hon. Gentleman tell
us what led him to incorporate independent members in the development
council. I can well understand that when an inquiry into an industry is
being made, it is a good thing to have independent members, but surely
these independent members, if they are members for several years, will, in
fact, become experts in the industry, and so lose the one thing for which
an independent member is valued-that he knows nothing about it.
Sir S. Cripps: There are two reasons. First, a number of working parties
have recommended it. After examining the whole conclusions themselves,
it likely arose out of their own experience. We can imagine them saying,
"We are a jolly good body and we have done good work. We should like
to see a body like ourselves continuing in industry." Secondly, it is similar
to what happens when the directors of a company want to get someone with
a different type of experience, someone who is not permanently and wholly
devoted to the industry. It may be a good engineer, who is associated
with quite a different type of industry but whose knowledge would be a
great advantage in assisting engineering development. It may be a designer
or an accountant, who has experience of some analogous industry. I am
sure persons of that kind can be of great assistance in helping to spread
experience between different industries. Particularly where a chairman is
concerned, I think that every working party suggested that he should be
an independent person.
Mr. Edgar Granville (Liberal): There is nothing wrong with an inde-
pendent being accepted, so long as he is not representative of, elected by or
appointed by one of the associations concerned in the industry.
Sir S. Cripps: Under the Bill independent members must be persons
"as to whom the Board or Minister concerned is satisfied that they have no such
financial or industrial interest as is likely to affect them in the discharge of their
functions as members of the council."
[An HON. MEMBER: "What about consumers?"] A consumer can be an in-
dependent person from several points of view. We could put in a dis-
tributor or a wholesaler, because he has no interest in the manufacture or
production of the goods of that particular industry. He is interested only
in distribution and, therefore, there is nothing to prevent him, as a dis-
tributor, being an independent member.
I was dealing with Clause 9 which is a matter outside development
councils in the sense that there may be certain industries in which a devel-
opment council will not be required, but which, on the other hand, would
like to have the means of collecting a levy for research, for development,
for design or for export as we have already found in a number of cases. In
those cases, under this Clause it will be possible, without setting up a
development council, to make provision within the industry, for a levy to
support either scientific research, the promotion of export trade or the
improvement of design. I will not go into 4the details of how the matters
are to be arranged, but they are set out in the Clause.
Under Clause 10, there are provisions for the disposal of certain ac-
cumulated funds and surpluses from certain wartime organizations which

House of Commons, February 13, 1947
were set up when exports were being encouraged, in the early stages of
the war. Power is given to distribute those in the cause of advancing this
general principle. Under Clause 11, legal power is given to do what has
already been done in the Supplementary Estimate-to make a grant to the
Council of Industrial Design, and to make grants to associated bodies of
various kinds which have as their purpose the encouragement of design
in any industry. It is rather similar power to the power exercised as re-
gards the Department of Scientific and Industrial Research. I do not think
I need trouble the House with any of the other provisions except to men-
tion again the Clause which deals with the repeal of the Cotton Industry
(Reorganization) Act. This Act will no longer be required. It has never
come into operation and in any case its functions will be replaced by an
order made under this Bill. I have I hope covered the main points. I have
no doubt that hon. Members will have questions to ask, which the Parlia-
mentary Secretary will attempt to answer, when he replies.
In conclusion, I should like to say that I believe that the provisions with
which I have dealt, properly administered, will prove of great value to the
industries of this country. They are not novel in their conception; they
have been anticipated by the structure of the Cotton Board which is un-
doubtedly proving of great value. What we are seeking to do by this Bill
is to make similar conveniences and advantages available for other indus-
tries, leaving it to Parliament to judge in each case, as it will have to, when
each order comes up for affirmative approval. In the light of the actual
treatment of the proposal, when it is submitted, it will be seen whether
Parliament considers it desirable to consent to the adoption of the scheme
for a particular industry-a scheme which will come up, of course, after
having been formulated following full discussions on both sides of the in-
dustry. I feel that this is the least we can do to assist in carrying out the
fundamental and organizational proposals which have been put forward by
the working parties, and those reports in my view have been submitted
after a most meticulous examination of all the problems of the industries
concerned. It is because of our anxiety to get ahead and make rapid
progress towards efficiency in all this wide field of private enterprise in-
dustry, that I ask the House today to grant a Second Reading to this Bill,
and, I hope, to speed its passage thereafter.
Mr. Oliver Lyttelton (Conservative): It is always a great pleasure in this
House to hear a skillful Parliamentary performance, and particularly one
by the right hon. and learned Gentleman in an emollient mood. We have
listened to a very sober recital of the advantages of the Bill according to
the right hon. and learned Gentleman, but he has, with his customary skill
concealed the weakness of his case, skated over those things which go too
far and generally has been in a mood of sweet reasonableness-apparently.
Of course, no one in any part of the House would cavil at the objects
which the Bill has set and the terms, however magisterial, in which the
objectives are defined.
The general object of the development councils is to increase the ef-
ficiency and productivity of their particular industries, and to enable them
to render better and more economic services to the community. We would

Industrial Organization Bill [MR. LYTTELTON)

all say "Bravo" to that object, particularly if we were prepared to forget
certain things that are happening at the present moment, but I must say
that if the Government have any discernible qualities, those of a sense of
timing and a sense of irony are certainly not among them. A week or two
ago they were exhorting all sides of industry to produce more, and they
actually issued the first economic White Paper-which ended by adjuring
everybody to put their backs into it and produce more-on the very day
that the first drastic coal cuts in industry were announced, making any
exhortations futile. Now, this very week has been chosen to produce the
present Bill, and it seems to me to be a most infelicitous moment. We should
feel a great deal happier if the Government could show us a single in-
stance where they could manage their own business, with even reasonable
competence, before they embark on Measures to teach other people how to
manage theirs. Nevertheless, as I have said, the objectives are unexcep-
tionable and we can all endorse them, but having said that-and I always
go as far as I can with the right hon. and learned Gentleman-I must add
that it is at this point that I depart very sharply from him. When we
come to the nature of the legislation, and the methods to be pursued, that
is the point at which we join issue with the Government.
Let me deal first of all with the nature of the legislation. The right hon.
Gentleman put up a very polite, bland and urbane excuse for this method
of legislation. I recognize, as do all hon. Members, the great difficulties
which attend the framing of legislation which has to deal with a confusing
variety of problems and to cover the complex and interlocking nature of
modern industry. It is, in fact, impossible to apply a single remedy or a
single Act of Parliament, so that it is applicable to the almost infinite varia-
tions of the problem, and in some cases no legislation is really needed at all.
There are, of course, two ways of dealing with a heterogeneous problem such
as this. The first is by the constitutional and democratic method of making
clear-cut and clearly-defined legislation where necessary so that it can solve
a problem or a group of problems which may prove intractable to other
methods. This is, as I shall show later, the type of legislation which is used
to set up wages councils. It is a precise method and gives the greatest Par-
liamentary control, and surely, if we believe in the sovereignty of Parlia-
ment and parliamentary control, this point should be among the first pre-
occupations of hon. Members in all parts of the House. This process of
thought narrows the area of uncertainty, and points a keen and sharp in-
strument for a special and particular purpose.
I entirely reject the right hon. and learned Gentleman's argument that
this type of legislation of a rather ad hoc nature is inapplicable to the
present problems. They can be grouped, and it would be perfectly possible
to introduce specific legislation to deal with the groups of problems instead
of asking for these unlimited powers. It must be acknowledged, of course,
that this method involves the Ministers in certain processes of thought
which are always rather tiresome. It also involves them in paying close at-
tention to the problems of a number of different industries, in thinking
long and deeply about how they are to be assisted and the means to be

House of Commons, February 13, 1947

adopted if they are required to foster a better organization, and in deciding
then, and only then, whether a number of Bills to fit the varying nature of
the problems are indeed required. Naturally, where the Government have
determined, as in cotton, to give financial assistance to an industry on a
large scale, legislation of the kind I have mentioned is no doubt necessary,
but it differs entirely from those cases where industries have trade boards,
wages councils and voluntary organizations. I will return to that point
Whatever the arguments may be, the Government have not chosen this
precise, constitutional and democratic method. They have chosen the other
-the idle, perfunctory method of this Bill. The Government say, "Since we
must produce Bills, and since we produce very little else, do not let us
think precisely. That would waste time. Let us seek rather the widest and
least defined of powers which could be issued and applied to almost any-
thing, and when we have obtained these powers from a shaken but still
docile Parliamentary majority, let us see afterwards what we are going to
do with them . ."
The Government say, "If anyone objects to the unlimited nature of
these powers, we can always reply, as we did over the Goods and Services
Bill, that the powers will not be used in that way. We have all these
,-things, but we are very sensible people, and very sensible managers. Look
at the production drive and how it is going today. We shall know just
how much discretion to mix with the potion." But that is no kind of
answer at all. The truth is that this Bill is the very worst type of delegated
legislation, and I do not think that these statutory development councils
are the right means of organization to help industry where that is neces-
sary. Nor, as I have said before, do I think that any general remedy can be
found within the framework of a single Act of Parliament without taking
these almost unlimited powers which I do not think should be taken. I
have said that this Bill could hardly seek wider or less defined powers, and
if hon. Members doubt the justice of that phrase let them study three
things in the Measure itself. I am afraid that I must trespass on the patience
of the House by quoting two. First, Clause 8 (2) says:
"At the request of the development council provision may be made by an amend-
ing order under this Section for assigning to the council functions for whose exercise
by the council it appears to the Board or Minister concerned to be expedient to
provide for any of the purposes mentioned in Subsection (1) of Section one of this
Act, being functions of a kind similar to those specified in the First Schedule to this
Act or such as appear to the Board or Minister concerned to be capable of being
conveniently exercised in association with functions of a kind specified in that Sched-
ule which have been assigned to the council or are to be assigned to them by the
amending order."
That Clause is the most extreme example of an "overcoat" Clause which I
have ever seen in my short experience of Parliamentary life. One has to
read it in conjunction with Clause 1 (4), which says:
"A development council order may provide for any incidental or supplementary
matters for which it appears to the Board or Minister concerned to be necessary or
expedient to provide."
Those are the two Clauses in the Bill to which I referred, and nothing
could be wider.

Industrial Organization Bill [MB. LYTTELTON]

There is a third matter, to which I will refer later on. It concerns the
First Schedule. Study of that Schedule will show that the functions there
set out embrace almost all the activities of any industry, except the func-
tion to which the right hon. and learned Gentleman has referred, that of
turning itself into a cartel-and except, of course, that of making a profit.
That is a rather significant omission, but we all know how naughty it is
today to try to make a profit, however glad the Chancellor of the Exchequer
may be to take it away afterwards. The area of uncertainty, which is now
a regular feature of the present Government's policy, will be spread far
and wide, while we shall be left largely ,in the dark about the Government's
intentions. The description of the Bill should be amended to read some-
thing like this: "A Bill to legislate first over the widest possible field, and
to start thinking afterwards." It appears to us on this side of the House
that, if unamended, the Bill can carry Socialism in one form, with all the
attendant mismanagement that that means, into any of the industries of
the country. It is true that the Bill does not provide for State ownership
or for compensation-or confiscation as it has now become-but it provides
for unlimited State interference, or, if you like, intervention, with the slim-
mest and dimmest Parliamentary control.
Sir S. Cripps: Would the right hon. Gentleman point out where the pro-
vision for State intervention is?
Mr. Lyttelton: I will come to that point later on. The point I am making
at the moment is that the Minister will be able, under these provisions, to
place himself virtually in control of these development councils. That is
where he gets his finger into the pie. I have dealt with the general nature
of this legislation, which I say is delegated legislation of the worst kind.
Enormous powers are sought. The right hon. and learned Gentleman tries
to calm our fears about the immense range of these powers by saying that
they will be used with discretion. That argument is very poor, and un-
worthy of him.
Now, let me pass from the general nature of the Bill in order to examine
it in greater detail. I want to impress upon the House with all the force
that I can, that the Bill raises a fundamental question of the utmost im-
portance to industry. The fundamental question is whether we are to aban-
don the voluntary method of negotiation, and undermine the voluntary
organizations which exist in this field, in favor of State machinery such as
the development councils? I noticed that the right hon. and learned Gen-
tleman skated very quickly over this point. He only said something which
is quite obvious to all of us, that in dealing with industry you must deal
with some body other than a trade association. He entirely evaded the
point. I am on quite a different point. I am saying that these statutory
bodies will tend to overload and overlap the voluntary organizations which
exist in industry, such as those organizations representing trade unions and
employers. This part of my subject falls into two parts. The first is the
overlapping and overlaying of the functions of other Ministers, notably the
Minister of Labor. I cannot believe that much thought has been given to

House of Commons, February 13, 1947

this subject, but if there has been a departmental battle, it is obvious that
the Minister of Labor has lost it all down the line. We must turn to the
First Schedule for illustrations of my point. Paragraph 2 uses these words,
among others:
"Promoting . inquiry . as to labor utilization."
That surely cuts across the province of the Ministry of Labor. Paragraph
3 relates to industrial psychology. Paragraph 8 is concerned with promot-
ing technical training. What does the Minister of Labor think of those
paragraphs? There is even worse in paragraph 9, which cuts straight across
the relations between trade unions and employers' federations, and other
joint negotiating bodies. Then, look at paragraph 10:
"Promoting or undertaking research into the incidence, prevention and cure of
industrial diseases."
This relates to a continuing and necessary piece of research which we can,
at no time, afford to neglect; but is the development council the right
medium? How far does the inclusion of this paragraph in the Schedule
mean that the work of the development council cuts across the activities
of bodies both national and international which are now functioning in
this field?
Mr. Attewell (Labor): Can the right hon. Gentleman give us the names
of the bodies that are functioning in industry?
Mr. Lyttelton: I cannot do so offhand, but I think it is within the
knowledge of the House that there are bodies like the International Labor
Organization which deal with these matters. Paragraph 12 also cuts straight
across the functions of the Ministry of Labor. I am sure that the right hon.
and learned Gentleman will recognize the justice of my remarks when I
say that if, when I was Minister of Production in the Coalition Govern-
ment, I had framed any such Schedule as this, it would have provoked a
most violent and characteristic reaction from the Minister of Labor, now
Foreign Secretary. I assure the House of my belief, that if the Foreign
Secretary were now Minister of Labor, the Bill would never have seen the
light of day. All these matters fall within the jurisdiction of the Minister
of Labor and National Service.
Mr. Kenneth Lindsay (Independent): Except one, which the right hon.
Gentleman did not mention-physical training. That is under the jurisdic-
tion of the Ministry of Education.
Mr. Lyttelton: I beg the hon. Member's pardon. There is certainly an-
other Ministry concerned there. In individual industries, many of the
matters fall within the jurisdiction of the joint machinery of employers and
workers under which the terms and conditions of employment in various
industries are negotiated. Well tried and highly organized machinery
already exists, not only for dealing with these matters in individual indus-
tries between the two sides, but also to secure that the two sides have the
necessary contact with the Ministry of Labor. The setting up of statutory
development councils with terms of reference which bring them into the
field of labor on so large a scale, can only lead to overlapping and a conflict
of jurisdiction among Government Departments.

Industrial Organization Bill [MR. LYTTELTON]

Even more serious is the duplication of machinery and of jurisdiction
which will arise in individual industries. That is again a point over which
the right hon. and learned Gentleman very wisely skated quickly. He
made a genuflexion over the difficulties by saying that he would, where it
was desired, see that two members of the Joint Industrial Council were
appointed to the development councils. That argument only serves to show
that he realizes there is a great danger of duplication and that, in fact,
duplication must take place. The appearance of these statutory bodies
will tend to break up the whole system of voluntary organization.
Mr. George Hicks (Labor): Does not the right hon. Gentleman know
that the development councils are to be composed of one-third representa-
tives of the employers and one-third of the operatives in the industry; and
will not these people be careful of the needs of the industry and refuse to
allow themselves to be intimidated by the other one-third?
Mr. Lyttelton: These are statutory bodies, and the independent members
will be subject to all kinds of ministerial control-here I am rather antici-
pating my later argument. These independent members will be introduced
into the statutory bodies which will, undoubtedly, abrogate the functions
now exercised by the trade unions on the one hand and the employers'
federations on the other. That is my sincere opinion.
I turn aside for one moment to consider what this machinery is to do,
and to what numbers of those employed in industry it applies. First, there
is the voluntary joint negotiating machinery set up by the employers' organ-
izations and trade unions themselves. Secondly, there is the statutory
machinery which is a development or evolution of the trade boards now
known as wages councils, which applies to those industries where the nego-
tiating machinery between employers and employees was considered to be
inefficient and where wages were deemed to be particularly low. I remind
the House that in the original Act setting up the trade boards, a public
inquiry had to be held to determine whether those two conditions obtained.
That has been altered by the Wages Councils Act of 1945, but the Minister
has still to satisfy himself that those two conditions obtain before he sets
up a wages council. So, the public inquiry has now been dispensed with.
There are 52 of these wages councils in existence, and there are other
similar bodies, with which the House will be familiar, which have been set
up under special Acts of Parliament such as the Catering Wages Board and
the Road Hauliers Wages Board and so forth.
According to the figures with which I have been supplied, voluntary
machinery covers about 12,500,000 persons employed in industry. Joint
negotiating machinery other than the joint industrial council covers about
7,500,000. These are cases in which there is no written charter between the
trade unions and the employers' organizations. Then there are industries,
employing 5 million workers, with written charters, covering the joint indus-
trial councils. That makes up the 12,500,000 covered by voluntary organ-
ization. Then there is the statutory machinery which I have already men-
tioned covering about 3,500,000. The total covered by these arrangements,
the bulk of which are voluntary, is therefore about 16,000,000, and I suggest

House of Commons, February 13, 1947

to the House that the present proposal for setting up development councils,
is entirely redundant as far as labor questions are concerned.
Mr. Bechervaise (Labor): It does not deal with conditions of employ-
Mr. Lyttelton: The hon. Gentleman has not followed the Schedule.
Mr. Cobb: Yes, we have.
Mr. Lyttelton: I do not want to go through it all again--
Mr. Bechervaise: The right hon. Gentleman might point out where wages
are mentioned.
Mr. Lyttelton: I started by referring to the utilization of labor.
Mr. Bechervaise: Labor utilization here really means the better applica-
tion of the machinery to secure better use of the labor available. It has
nothing whatever to do with the right hon. Gentleman's interpretation,
and I suggest that he is going much too far.
Mr. Lyttelton: All the things I have mentioned deal directly with labor
questions, but if hon. Members imagine-[Interruption.] I think I am
entitled to be heard. I am speaking with the greatest sincerity, and I shall
be only too glad to be proved wrong. If I say, hon. Members, particularly
those who have been trade union officials, imagine that development coun-
cils can be set up to deal with all this paraphernalia set out in the First
Schedule, without encroaching upon the field of wages and conditions,
they will prove to be utterly wrong. It is impossible to cover these matters
without overlaying and overlapping the machinery that exists. It is im-
possible, and hon. Members will one day remember what I have said.
I now turn to the question of training and entering into industry and
how these bodies overlap. These subjects have been discussed continuously
by both the Federation and the Trades Union Congress through the Joint
Consultative Committee of the Ministry of Labor and internationally at
the I.L.O. conferences. Indeed the Joint Consultative Committee in Decem-
ber, 1945, issued a report both to the organizations of employers and to
trade unions throughout the country laying down the standards on these
matters. I cannot see how the development councils can be prevented from
abrogating these functions in the process of time. The President of the
Board of Trade shelters to some extent behind a statement that none of
these councils will be formed except after consultation with industry.
That is in Clause 1 of the Bill, but it does not carry us nearly far enough.
In fact, he made things worse by saying in a very charming voice, that he
hoped he would never have to use compulsion, but that he must tell the
House that if people did not come along quietly, there existed behind his
emollient phrases, this power which he proposed to apply. It was, however,
better for people to come along quietly than for him to impose those powers
on them afterwards. We can follow him as far as that, but can we have a
definite assurance that the Government will consider an amendment to the
Bill, stating that these councils will not be set up unless, after consultation,
the Minister is satisfied that there is a majority of the industry in favor?

Industrial Organization Bill [M. LYTrTETON]

Sir S. Cripps indicated dissent.
Mr. Lyttelton: The right hon. and learned Gentleman shakes his head,
which shows that the provisions in Clause 1, about consultation are not
worth the paper they are written on.
Sir S. Crippe: How would the right hon. Gentleman arrive at the
majority? Would he give each employer the same vote as each employee?
Mr. Lyttelton: I did not ask for that at all.
Sir S. Cripps: The right hon. Gentleman said a majority of the industry.
How would he ascertain the majority? Would he give each employer the
same right to vote as each employee in order to find the majority?
Mr. Lyttelton: I imagine that in these cases the Minister would consult
the working parties which have been set up under his own aegis. On the
working parties there are a certain number of employers and a certain num-
ber of representatives of the trade unions, and all I am asking is that the
Minister should be satisfied that a majority of the two sides of the industry
are in favor of setting up a development council, because if they are not, I
can tell him straight away that they will not work, and everybody with prac-
tical knowledge of these matters knows that that is true. He says that the de-
velopment councils which he proposes to set up ab initio under this Bill have
in fact-it is one of his own arguments-fulfilled the condition which I now
ask he should apply in other directions. He said that the working parties
had unanimously recommended these development councils in certain cases.
Therefore, we know that the right hon. and learned Gentleman, however
difficult he may find it to ascertain a majority, is still able to ascertain
unanimity. I am asking whether we can have an assurance that a majority
will be ascertained before these statutory bodies are imposed on industry.
Mr. Cobb: How does the right hon. Gentleman define a majority?
Mr. Lyttelton: I want now to record my opinion in no uncertain terms
that by transferring these labor questions from the machinery built up
partly under the Ministry of Labor, and more generally by voluntary
bodies, to the new statutory machinery of development councils, the prestige
and efficiency of voluntary negotiating bodies, in which both sides of indus-
try have implicit confidence today, will be needlessly thrown away. Is there
any hon. Member, trade unionist or employer, who really thinks that this
is the time to start setting aside voluntary organization? I cannot say how
strongly I feel that these statutory development councils are the thin end
of the wedge, and that eventually the negotiating machinery, in which we
have great pride on both sides of industry, will be overthrown by this new
and ill-thought-out legislation. I remind hon. Members of what the present
Foreign Secretary, when he was Minister of Labor, said in the House on
the Wages Councils Bill, on 16th January, 1945. Referring to the voluntary
machinery, he spoke of
"the most priceless thing in this country, something which has carried us through
the war without loss of our liberties, the great voluntary system of negotiation in
the industries of this country.-[OFFIcuAL REPORT, 16th January, 1945; Vol. 407, c. 71.]

House of Commons, February 13, 1947

There are one or two less important points with which I wish to deal.
Mr. Mikardo (Labor): There cannot be any.
Mr. Lyttelton: If the hon. Member for Reading (Mr. Mikardo) wishes to
interrupt me, let him rise to his feet. I turn now to the question of the
so-called independent members. To earn the title "independent," members
must have
"no such financial or industrial interest as is likely to affect them in the discharge of
their functions."
Expressed in less elegant language, the qualification is that the member
knows nothing whatever about the industry in which he is about to perform
the duties of schoolmaster and adviser. [Interruption.] I know how dis-
tasteful it is to hon. Members opposite if I expose some of the weaknesses
of the Bill. They must get accustomed to understanding that there are two
sides to these questions, however distressing that may be to them. There
is another curious provision as regards independent members. Just at the
time when the new Companies Bill seeks to prevent compensation for loss
of office, I think quite properly, or gratuities being paid to directors of
joint stock companies on retirement, the Bill gives the Minister and the
councils the right to pay gratuities and pensions to the retiring members.
This is yet another piece of patronage given to a Minister over an undefined
area, and, of course, it is a very powerful weapon to prevent the inde-
pendent members from becoming too independent. This is one of the
means by which Ministers are seeking to influence in the direction in which
they wish the deliberations of these councils. I can see the reason for the
chairman being appointed by the Minister from outside the industry, even
if it does mean perpetuating the system under which the Government con-
siders it right to appoint the Adjutant-General as chairman of the Linoleum
Board. I quite agree that we have swallowed some of these things, but I
see little except disadvantage-
Sir S. Cripps: Is not the right hon. Gentleman being offensive to the
person concerned?
Mr. Lyttelton: I said that I did not mind the perpetuation of a system by
which the Adjutant-General becomes chairman of the Linoleum Board. It
emphasizes that the chief qualification of independent members must be
that they know nothing of the industry concerned. I see little but disad-
vantage in the appointment of other so-called independent members. In
the first place, it gives the Minister virtual control, if he chooses to exercise
it, over the development councils where the two sides of the industry are
not in agreement. Secondly, the development councils, when they are set
up, will have to spend, as working parties have done, the first six months
or year of their operations in teaching the independent members the simple
facts about the industry, without which obviously no recommendations
can be made. These development councils will, furthermore, place a very
severe strain on the personnel of other industries from which, according to
the terms of reference, the independent members have to be drawn. Indus-

Industrial Organization Bill [MR. LYTTELTON)

trial relations have been governed by bodies representing employers and
trade unions, without the introduction of independent members, for a very
long time, and I think this machinery should not be altered.

There are two more subjects to which I wish to refer. The first is scien-
tific research. I yield to none in my advocacy of scientific research and
development as an aid to industrial prosperity, and the Government are
now beginning to recognize that. Here, as in other places, they acknowl-
edge its importance. I welcome that heartily, but I must turn aside for
one moment to give the House an example-and this is entirely within my
own experience-of how the Government's protestations on research worked
out in practice. My own company, which I think I may claim has always
been in the forefront of industrial research and development, is attempting
to expand its fundamental research, particularly in those aspects of nuclear
physics which may have application to peaceful use. The company owns a
large country house near Reading, suitable for a research station. The
property was requisitioned during the war and it has been virtually empty-
one or two people at the most have been in it-for nine months. For nine
months we have tried to get it released, and have had to look on at the
usual battledore and shuttlecock between Government Departments, and
still we cannot get our own unoccupied property back. Of course, when
we do get it back, the usual battle over licenses will begin. This property
has been unoccupied for nine months, it is required for research, and we
cannot get it released. I mention this to show how the Government pro-
mote research. I suggest that they set up a development council of their
own to co-ordinate the activities of requisitioning Departments, and, if they
believe in this machinery, they will find the battledore and shuttlecock can
be cut down by months and months. I would like to see a little more
practical approach to the question of research and fewer protestations.

The last subject to which I want to refer is the levy. It has some signfi-
cance in relation to research and development. Suppose that there are a
hundred firms in an industry, and 75 of them are progressive and spend a
large amount of money on research, and suppose that there are 25 back-
ward firms. Under this Bill, as framed, a levy could be raised from the 75
firms in order to set up research and development for the 25 firms. This is
what I think would commonly be called an injustice, and something which
puts a penalty upon efficiency. I very much fear that the effect of these
proposals will be the opposite of what the Government think. The
tendency will be created for people to sit back and wait until the research
can be paid for under these arrangements by the industry as a whole. I
think that these provisions are extremely dangerous and not beneficial,
because research is the last subject which should be regimented and cen-
tralized in the way proposed. This part of the subject has not been thought
out at all in this Bill and the provisions are harmful.
Lastly, there is the matter of principle involved in this right of imposing

House of Commons, February 13, 1947

a levy. There used to be an old constitutional slogan: "No taxation with-
out representation." In the process of time, it is quite true that we have
given representation to many who are not taxed at all or are very lightly
taxed, but that does not detract from that old slogan. Under this Bill it
is possible for a council to impose a levy on unwilling members of an indus-
try. There is far too little recourse to Parliament which is one of the few
remaining rights left to the taxpayers in this kind of matter. I trust that
this part of the Bill can be amended, so that a levy will not be imposed
unless a substantial majority in the industry is in favor of it.
Mr. Scott-Elliott (Labor): Would the right hon. Member be a little more
precise about one point which is troubling me? He has used some phrase
like "direct contact between industry and the Government." Would he say
more precisely if he feels this might be done by means of trade associations,
joint industrial councils, or what?
Mr. Lyttelton: My general approach would be to use the existing machin-
ery which is the Joint Industrial Councils plus the other voluntary organ-
izations, and, in the case of the wages councils, the statutory bodies. If any
of those are felt to be inadequate to the purpose, or not to cover a wide
enough field from the point of view of either side of industry, the right way
to approach the subject is to try to evolve from those bodies something
which would operate adequately over the whole field. That is my point
of view, and I would not try to replace them by this new-fangled statutory
development council.
To sum up, this Bill represents delegated legislation of the worst type.
It overcomes the difficulties inherent in the varied nature of the problem
by seeking unlimited, overriding, enabling powers-and the right hon. and
learned Gentleman admitted that. That can be seen in the First Schedule
and in Clauses 8 and 1 (4). The whole Bill pays only lip-service, and the
right hon. and learned Gentleman has emphasized that fact, to the principle
of consultation. Secondly, it is designed-that is not the right word-it will
have the effect of destroying the voluntary machinery for negotiation be-
tween the two sides of industry. Thirdly, many of the paragraphs in the
First Schedule give eight Ministers and Ministries powers to cut aacoss the
functions of the Ministry of Labor. Fourthly, the independent members
other than the chairmen appear to be redundant. Fifthly, the Bill sets up
a new bureaucracy, widens the range of patronage to the Government and
gives power for the retiring members of the council to be paid pensions
and gratuities. Sixthly, it gives the council power to impose taxes on mem-
bers of an industry whether they like it or not, and violates the principle of
"No taxation without representation." Lastly, it is an insidious means of
giving eight Ministers overriding powers to control and regiment any indus-
try in the country over the heads of either the trade unions or the employers'
federations. For all these reasons, we propose to vote against the Bill.
Mr. F. A. Cobb (Labor): I wish to take up one point emphasized by the
right hon. Member for Aldershot (Mr. Lyttelton)-the question of inde-
pendent members. Was the right hon. Gentleman being quite open in his
objections to the appointment of independent members? Let us take the

Industrial Organization Bill [MB. COBB]

case of some trade associations. Let us for the sake of argument take the
Electric Lamp Manufacturers' Association, in which the right hon. Gentle-
man is interested. Let us consider the method of operation of this particu-
lar body as an example, and see why they would object to an independent
member on one of these bodies poking his nose into this particular associa-
tion's activities-
Mr. Lyttelton: I am sure this is a very interesting line, which the hon.
Member always likes to pursue, but it is quite without application to the
particular argument. I was talking of a body on which the employers and
the trade unions were represented. The particular body he is talking about
is only an employers' body. What he is saying, although it may be of gen-
eral interest elsewhere, has no reference whatever to the argument I was
Mr. Cobb: The right hon. Gentleman did say that these bodies which the
Bill seeks to set up would to some extent interfere with the operations of
some trade associations-
Mr. Lyttelton: I must interrupt the hon. Member again. I know quite well
that he is trying to introduce personal matters into this discussion, but I
may say straight away that I have never advanced that point at all. I was
talking of independent members where employers and employed are already
represented. If the hon. Member will confine himself to the points I made,
and not try to demolish the points I did not make, we shall get on better.
Mr. Cobb: I understood the right hon. Gentleman to make the point that
he did not like the appointment of independent members. He advanced
one reason, but I have the impression that it was a manufactured reason
and that the real reason for his objection was something far more--
Mr. Lyttelton: On a point of Order, Mr. Deputy-Speaker. Is the hon.
Member in Order in imputing to me insincere statements on a matter of
this kind?
Mr. Deputy-Speaker (Major Milner): I do not know whether that was
the suggestion, but perhaps the right hon. Gentleman will allow the hon.
Gentleman to develop his argument in his own way and we shall then
see what he has to say.
Mr. Cobb: I do not think I am making imputations. Let us leave what
the right hon. Gentleman said, and examine the operations of some trade
associations in this country, of which the Electric Lamp Manufacturers'
Association is one. Let us see why this particular association might object
to independent members on the new body which might be set up for that
section of the electrical industry. The Electric Lamp Manufacturers' Asso-
ciation, if it is not a cartel, is almost a cartel. They have not done a great
deal of research in this country. They meet together and decide the sell-
ing prices of lamps. They fix the discount to the retailers and to the
wholesalers, and they have never disclosed the manufacturing costs. In
fact they never disclosed them to the Ministry during the war. They
rejected any effort at costing. It will not have escaped the House that the
question of costing is mentioned here. I have no doubt that it has not

House of Commons, February 13, 1947
escaped the attention of the right hon. Member for Aldershot. The Electric
Lamp Manufacturers' Association rejected costing. It is rather significant
that they maintained their prices throughout the war, and that instead of
increasing them when costs began to go up at the end of the war, for some
mysterious reason-which may have been due to pressure from the Ministry
of Supply-they reduced their prices to the public by 20 per cent. It is on
the cards that an association like this might be very reluctant to have inde-
pendent members poking their noses into operations of this description. I
can well understand it.
For instance, they might not like it at the moment if the glass supplies
for the lamp industry were to be investigated. I wonder whether an in-
dependent member would not start asking questions why some of the
independent lamp manufacturers who are not in the ring, find it difficult
to get glass bulbs when the only manufacturers who make them are in
the ring. Why is it that these independent manufacturers are not getting
all the glass bulbs they want?
Mr. Sidney Shephard (Conservative): On a point of Order, Mr. Deputy-
Speaker. Is the hon. Gentleman speaking to the Bill?
Mr. Deputy-Speaker: The hon. Member was dealing with the question of
independent members. An hon. Member is entitled to make his speech
in his own way, and is responsible for what he says.
Mr. Benson (,abor): The consumer's point of view.
Mr. Deputy-Speaker: The hon. Member's remarks must be relevant to the
Mr. W. S. Shepherd (Conservative): Would the hon. Gentleman
name any concern in this country which is able at the present time to
carry all the supplies of glassware it would wish in order to carry on its
Mr. Cobb: Because the glass manufacturers of this country, including the
members of E.L.M.A. are so hopelessly inefficient, as compared with their
competitors in America, they cannot supply all the glass. The example I
was quoting was of an independent lamp manufacturer, whose factory
is shut down in an area of unemployment due to the fact that he cannot
get bulbs, and the only source from which he can get bulbs is his ring
competitor, namely, E.L.M.A. I am suggesting that this Bill has been
brought forward to set up independent members on the organization pro-
posed in the Bill, so that these things can be looked at. It is to the public
interest to see that they do not happen in the future. Not only do we
want organizations to promote research, but we want the public to
know the facts for once, so that the free wind of public opinion can
blow through some of these boardroom doors which have remained
shut so long. I know it is very awkward for some hon. and right
hon. Gentlemen opposite who have kept these things secret for so long,
that hon. Members on this side of the House should have had the sense
to allow hon. Members to be elected on this side of the House for once
who know something about these things.

Industrial Organization Bill [MR. COBBn

I leave that particular point because there are one or two other matters
on which I should like to touch. Strange as it may seem, I have sympathy
with some of the points put forward by the right hon. Member for Alder-
shot. I have some sympathy with him, but not entirely, because the elo-
quent speech of my right hon. and learned Friend the President of the
Board of Trade has convinced me that, with regard to one or two views
I had, I may have been barking up the wrong tree.
Mr. Lyttelton: Oh, no.
Mr. Cobb: It is true that a large part of British industry could benefit by
greater activity in the fields enumerated in the Schedule. There, we are
probably completely in agreement, but I wonder whether the method
chosen is the right one. Could not they be re-formed-I trust my hon.
Friend the Parliamentary Secretary will mark that I said "re-formed"-
with trade associations together with trade unions? Trade associations at
the present moment generally represent only employers. The distributor
interests, generally, are not represented on these trade associations, neither
is the consumer interest represented. I wonder whether a trade associa-
tion could by some reorganization have distribution and consumer in-
terests properly represented, to make sure that the small manufacturer is
adequately represented? I realize that my right hon. Friend the President
of the Board of Trade put forward the most persuasive reasons why that
should not be done, but I would like the Parliamentary Secretary, when
he replies, to enlarge upon that to some extent. I feel that we have far too
little managerial talent in this country, and that the setting up of these
new tripartite bodies may point, to some extent, to waste of managerial and
trade union time. It is only a query in my mind, but it might be advan-
tageous if it were examined.

There is another point which will arise when we come to the question
of the small manufacturers, and that is whether you use the machinery of
existing trade associations, or set up these new tripartite bodies. As one
with some practical experience of the operation of this, I have in mind
that the real grass roots of industry, the small manufacturer, the man who
really works on the job and knows it, is not touched by these vast high level
organizations. Officials of Ministries can, and do, deal with the chief ex-
ecutives of big manufacturers, but let us remember that before the war,
there were only about 1,000 companies in this country with more than
1,000 employees. There are some 40,000 small manufacturers. My con-
stituency is a remarkable example of a cross-section of these. Take out two
or three manufacturers in Elland and Brighouse in the West Riding of
Yorkshire, and the rest honest-to-God, small manufacturers, have never
heard of the Regional Council, of the Ministry of Supply, or of the Board
of Trade. It is impossible for officials to go anywhere near them. That is
the great defect of whatever organization is set up. Whether you have trade
associations re-formed as I have suggested, whether you have these new tri-
partite organizations, will they get down to these people?

House of Commons, February 13, 1947

I want to recommend to my right hon. and learned Friend one good
maxim: that if you want to get results, you have to make calls. Let me quote
the Department of Scientific and Industrial Research to show what I mean.
Here you have an admirable Government body, set up to do research for
industry but, good as it is, that body has never got down to the small manu-
facturer. I have suggested several times that the D.S.I.R. should put tech-
nical commercial men on the road to call on the small manufacturers, talk
to them, and make them aware of what is being done. No matter how this
Bill is operated, if you are to get down to the real background, the real
roots of British industry, the small manufacturer-who, in many cases is
antagonistic to research; scientific and engineering research have never been
sold to him yet-you will never do it by writing to him, by holding high-
brow technical lectures in London or in the main towns of the country.
You will only do it by arguing this matter out with the man on the spot.
When your technical commercial salesman first calls, he will probably be
thrown out on his ear, but he will have to find, as every salesman has to
do, ways and means to get in and sell his product. In this case, it is science
and research and developmental engineering.
I am sure this has to be done, and I am convinced that whatever kind of
organization we set up, unless it is taken to the consumer, it will not be
used. That is one reason why I am not happy about this proposal. I am
not happy about it for a different reason from that of the right hon. Mem-
ber for Aldershot. If I were a small manufacturer-and I have a lot to do
with a small manufacturing company-I would object to the compulsory
levy, because I would feel that it would organize me out of business, in-
stead of competing me out of business. Also organizations such as those of
the right hon. Member for Aldershot have considerable advantages over the
small manufacturers. I do not blame him, and I do not mind if he com-
petes me out of business. But, I would mind if he organized me out of
business, by an organization for which I have to help pay. Unless I can
get the benefits of this research, for which I have to pay, the benefits go
to the big company, which is put in a better position to organize me out of
business. In other words, the benefits of the research, which have to be
paid for by everyone in the industry, are going to the big companies, the
dominant dozen in the industry, the people who already use their organiza-
tion, and dominate the position in trade associations, but can organize a
small competitor out of business. If we do not see that the benefits of this
work go right down to the small manufacturer, and are sold to him, the
big man will be benefited to the detriment of the small man.
The Bill sets out to do a lot of things. It provides pools of research,
but how are we to get the people in industry to drink from them? Nothing
is said about that. I suppose we have to fall back on what the President
of the Board of Trade said-that it depends very much on how the Bill is
operated. There I agree with him. We have to do the research, but we
ought to make sure that the people in industry know about it, and provide
persons with degrees to enable this information to come into the factories.
There could be one man with a B.Sc. degree in a factory, or, where there
are a number of factories, one such man for a small group. In my con-

Industrial Organization Bill [MR. PITMAN]
stituency there are several small manufacturers. It may be that not one
could afford a man with a B.Sc. degree on the staff, but, possibly, five
could afford to engage him. In practice, the present arrangement is that
the big manufacturer can afford to have such people going backward and
forward between the research establishment, and his own establishment. Sub-
consciously, the research establishment does the work that the big company
wants to be done. Unless we can get qualified men attached to small fac-
tories, we shall not get an adequate flow of knowledge from the research
establishments into the small manufacturers' premises.

As to this proposed dichotomy between production and distribution, I
was surprised to hear the President say that when the research organiza-
tions are set up, they will apply to production problems only, and not to
distribution problems. If there is anything in this country that needs re-
search, it is distribution. Over the last century, for every pound spent on
research into production problems, I do not suppose twopence has been
spent on distribution. The skilled industrial manufacturer solves many
of his production problems in the sales field, and many of his sales prob-
lems in the factory. This is a well-known practice, and to draw a line be-
tween distribution and production is a thoroughly bad thing. I hope the
President will have another look at this point. Perhaps he will deal with
distribution in some way later on. I believe distribution and production
ought always to work hand in glove, and be closely geared one to the other.
The Parliamentary Secretary to the Board of Trade (Mr. Belcher):
I think my hon. Friend misunderstood my right hon. and learned Friend's
reference to distribution. What he said" was that there was not to be a de-
velopment council for distribution as an industry. But there is nothing to
stop a development council for a particular industry inquiring into prob-
lems of distribution, such as my hon. Friend has mentioned. If my hon.
Friend looks at the First Schedule, he will see paragraph 5 which specifically
refers to the:
"production and marketing of standard products."
Mr. Cobb: I am much obliged to my hon. Friend. I have read the Bill,
and it was because I had read it that I was surprised to hear the President
say what I thought he said. I hope that when the President comes to
operate the Bill, and to appoint people, he will see that they are not all
trade unionists, or production people, but that someone with knowledge
of distribution will be appointed, so that we can get closer collaboration
between production and distribution in each one of the councils which
are set up. If that is done, I think it will mean that we shall get some
very good results from the operation of the Bill.
Mr. I. J. Pitman (Conservative): It is always a pleasure to listen to the
hon. Member for Elland (Mr. Cobb). He is one of the pillars of the modern
"managerial revolution" and he has an outstanding record in manage-
ment. I think, however, that for the first part of his speech he ought to

House of Commons, February 13, 1947

have read his Bible a little better. There is a fine passage in Ecclesiasticus
which says:
"Speak to thy friend peradventure he did it not: and if he did it, that he do it
not again."
Over the Electric Light Lamp Manufacturers, and over my right hon.
Friend the Member for Aldershot (Mr. Lyttelton) I think he has been
extremely unfair. I know he did not intend it, but he was. Surely the issue
is this. Industrialists and the right hon. Member for Aldershot among
them are saying, "We are perfectly prepared to throw open our books and
information to the development council consisting of representatives of
the trade unions and even, I imagine, to representatives of consumers. We
have no secrets of which we are ashamed." All that the right hon. Gentleman
for Aldershot in fact complained about was the unnecessary presence of
the independent member who was in effect capable of being a Government
stooge. It was to his presence that he objected, not to the information
being available outside the boardroom doors.

I speak in three capacities. First, as an ex-Director of Organization and
Methods of the Treasury. It seems to me that this Bill is really applying
the idea of "organization and methods" which have been adopted by the
Civil Service at the request of this House, to industry generally. In passing,
let me say that my experience is that the Civil Service has adopted the idea
of organization and methods very well. Let me also pay a tribute to the
President of the Board of Trade in that since my departure, the 0. & M.
-Organization and Method Section-at the Board of Trade-has progressed
enormously. I attribute that largely and gratefully to his personal interest
and practical support.
I am, however, sorry not to see the name of the Chancellor of the
Exchequer backing the Bill, because I think if it had been referred to the
Chancellor then the Treasury's 0. and M. Section would have put this
Bill right, and in many respects. It seems to me that this Bill violates the
one principal and cardinal factor upon which successful organization and
methods work can be conducted. I see the hon. Member for Reading (Mr.
Mikardo) in his seat opposite. I know from personal experience that both
in industrial consultants and in the O. and M. Departments of the Civil
Service the application of brain and infinite capacity for taking pains to
problems of human effort whether in matters of organization or of method
yields colossal dividends in material benefits, and also, because after all
we are all human beings, in spiritual benefits as well. But the very strength
of the Treasury O. and M. Division, and the very strength of the consultant
in a business, is that it is a free association in what is a most delicate and
personal relationship.
There are three parties in any 0. and M. work. There is the O. and M.
worker, there is the management, which carries the responsibility, and,
finally, there is the staff, who have to carry out the changes. At present any
one of these three can walk out of that relation as freely.as they contracted
it, and it is the very essence of it, just as matrimony and particularly happi-

Industrial Organization Bill [MR. PITMAN]

ness in matrimony depend upon a relationship which is freely and will-
ingly formed, and not upon something which is forced. So in the 0. and
M. relationship. Force by the Crown in its Legislature, in its judicature
in deciding issues and in its Executive in supervising it and imposing
penalties causes the free relationship to be vitiated and willing co-opera-
tion to be undermined. I say that the very presence of these three forces
within an Act produces the very condition under which organization and
methods as now proposed must fail. I am quite convinced that the right
hon. and learned Gentleman's only chance of succeeding is by operating
organization and methods voluntarily and willingly. I am sure that he could
succeed using persuasion rather than force. I would like to ask the Par-
liamentary Secretary whether the President of the Board of Trade is really
so despondent about his own ability, as a Cabinet Minister, whether he
really fears that with his position, with the traditions of his Department,
with all the knowledge and all the information he and his Department can
get under his Statistics Bill, that he cannot successfully act as a catalyst to
bring these three parties together voluntarily and so allow industry to
work this Bill voluntarily, and relieve them from the certain failure which
will come if he seeks to operate under duress.

May I next speak in my capacity as a citizen? It seems to me that the
Ministry of Labor has been very wise in avoiding and in continuing to
avoid direct responsibility for agreement between employer and worker
over wages. The President of the Board of Trade would have done well
to learn wisdom from that example and to have sidestepped the responsibil-
ity for efficiency of management in this country. I advise him this because,
let us face it, the moment this Bill is passed, anybody who likes to get out
of their own responsibility, whether as a manager or as a trade unionist, can.
with justification "pass the buck" by saying, "If we are doing wrong,
surely it is up to the Government to get their own development council
going and solve this. They have taken on the responsibility for solving this
problem. Let them get on with it."

Then may I next speak as an employer in the printing industry? That
industry is one which has been extremely happy in its relationships, and
has been so happy over a long period. Both sides of the industry, employers
and employees, face a great problem at the present time. The problem is,
how, voluntarily, can we make the transition from a period of unstable
employment during which both sides agreed on restrictive practices, or
connived at them, in order to make employment go round to a new period
where there is no longer need to. make the work go round. How can the
two sides adjust past agreements to a new world in which there is the
intention, and the high probability, of providing stable employment. Per-
haps I might give instances of the sort of problem with which a develop-
ment council in the printing industry will inevitably be faced immediately.
First, as between London and the Provinces, there is a most difficult prob-

House of Commons, February 13, 1947

lem within the field called in this Bill "labor utilization." Whereas the
printing machine minder in the country is supposed to be able to work not
only a cylinder machine, but a platen machine, in London he is supposed
to be able to work only one or the other and to be unable to work at all
unless his own personal "feeder" feeds his sheets. I would make it quite
clear that it is not really the case that the London minder is less experienced
or able than the provincial minder. But nevertheless the position is that
if a firm has two printing machines, one a cylinder and the other a platen
then if the opposite people are absent through sickness or other cause, work
on both those machines comes to a stop although at least one would be
made to work in the provinces.
Similarly, take the question of entry to the printing industry. There is
the whole question of apprenticeship-a most pressing problem for a
development council and remitted to them under paragraphs 11 and 8 of
the First Schedule. Then there is the most difficult question of working
pace. In the past deliberate restrictive practices by the trade unions in
the printing industry have kept down working pace below that of other
nations. It has no doubt been justifiable; at any rate it has been agreed
to by the employers for conditions of under-employment. But we have not
and will not have those conditions but new conditions. I believe firmly
that the printing industry can face these new conditions and solve those
and other difficulties. It has got a good spirit between employers and trade
unions. The two parties if left to negotiate under the conditions of free
will under which that spirit has won such outstanding progress and success
will come to an arrangement but the educative processes will work only
slowly. But submit those two to a situation in which the independent chair-
man and the independent member if they side with one side or the other,
can virtually force agreement on the third and it will be like bringing the
two sides together in battle.
I ask trade unionists, because I am sincere in this, whether they know
what they are letting themselves in for? I ask them to realize what will
happen. This Bill can be used, by increasing the levy, as a form of duress
to get employers to do what the trade union members and the independent
members wish done. Similarly if the Government and the independent
members side with the employers, then the development council can similarly
force the hand of the trade unions, because I see that under paragraph 2
of the First Schedule, one of the functions which are to be allowed to de-
velopment councils is not only
"promoting inquiry as to labor utilization,"
"the conduct of experimental establishments and of tests on a commercial scale."
I maintain that if a development council really desired to take over
an existing works or form a new works and run it as a blackleg concern, to
force the unions to do what the unions did not want, the trade union would
indeed be on the spot, with the whole force of the Government and em-
ployers against it. I think it is wholly wrong that industrial relations in
this country, which have a fine record behind them, should be suddenly
submitted to this brand new procedure, which makes each party capable

Industrial Organization Bill [MR. SIDNEY SHEPHARD)

of being subject to duress. It is negotiation under duress, and as every
trade unionist knows that will not get anyone anywhere.
Finally, I am surprised at the President of the Board of Trade for fail-
ing to apply his own principles. He is a man of great sincerity. He says
he wishes to proceed by agreement. Let him proceed by agreement. As I
say, willing relationship is the basis of all organization and methods work,
and no such work is really acceptable or successful unless it is founded on
free relationship. Secondly, let him not gratuitously and dangerously ac-
cept direct responsibility for the efficiency of industry in this country.
Finally, let him not inject these new procedures of duress into employer-
employee negotiations but let him leave it to the two sides and to the joint
industrial councils, and above all to the joint production committees of
factories. That is where the good work goes on.
I conclude with one small proverb which was mentioned by the hon.
Member for Elland (Mr. Cobb). It is that one man can take a horse to the
water but twenty men cannot make him drink. If the President of the
Board of Trade is to take to the water not a horse but Britishers, either
employers or labor trade unionists, and force their noses into the pool, he
will not only get no drinking but he will find such a mud and such a
stink in the pool, that any hope of their drinking voluntarily later will
have disappeared. I ask him to take this Bill away, to wash it in its own
muddy waters, and to drown it or to let us have it back in a quite dif-
ferent but much better form ....
Mr. Sidney Shephard (Conservative): I wish to look at this Bill through
the eyes of an industrialist who will be affected. I am engaged in the
hosiery industry. We have had a working party for that industry, and in
due course we shall presumably have a development council. The hon.
Member for East Woolwich (Mr. Hicks) said that this was a good Bill. I
think it is a thoroughly bad and mischievous Bill. It sets up a rigid and
cumbersome machine involving a waste of time and money, and it is very
doubtful indeed whether it will make any contribution to greater efficiency
or productivity. What it is bound to do is to perpetuate permanent con-
trol over those industries where development councils are set up. I was
always a little suspicious that this was what would happen. When the
President of the Board of Trade set up his working parties, I thought that
there was a little more in it than mere efficiency of industry. I thought
he was after closer control over industry and I think we all realize that by
this Bill he has achieved his object.

I wish to make reference to one or two parts of the Bill which I con-
sider to be important. Clause 1 (3) deals with the question of consultation,
which has been raised by many Members during the Debate. I am told
that in the talks which the President of the Board of Trade had with the
Federation of British Industries, he gave a verbal assurance that a develop-
ment council would not be imposed on an industry without substantial
agreement from both sides. I wish to ask the Parliamentary Secretary-

House of Commons, February 13, 1947

and I ask him to answer now-whether it is the intention to impose a
development council on an unwilling industry?
Mr. Belcher: I think that my right hon. and learned Friend made that
plain this afternoon. While admitting there are inherent dangers in im-
posing a development council on an unwilling industry, he could not ac-
cept the suggestion that there should never at any time be an imposition
of that kind when it might be deemed necessary in the national interest.
We much prefer to get it by agreement, and we think we shall probably get
it by agreement in most cases.
Mr. Shephard: I am glad to have that assurance. There is no assurance,
however, in the Bill, and I would imagine it to be more likely that a
Minister, having made up his mind to have a development council, will
go through this farce of consultation, and whether there is agreement or
not, will go ahead with it. Clause 2 (2) lays down that all members must
be appointed by the Board or the Minister concerned. It is obvious that
the Minister must nominate independent members, and no doubt the trade
unions will be asked to submit the names of those they wish to be nomi-
nated as representing the workers, but I should like to know what procedure
is to be adopted with regard to employers. Is the Minister going to ap-
proach the employers' associations and ask for a list of the people they wish
to be their representatives, or are they to be nominated arbitrarily?

I now wish to refer to the question of payment under Clause 2 (6). Are
we to understand that all these jobs are to be fully paid and full-time? If
that is so, how can the Minister possibly find persons with experience of
the industry concerned able to devote their whole-time services to a develop-
ment council? Surely, those who are engaged in industry will hardly be pre-
pared to give up their businesses to serve full-time, and it would seem that
the choice will be limited to the failures or those who have retired.

Under Clause 2 (3), it is left to the Minister to decide the number of
persons in each category to represent the employers, workers and outside
people. There is no guarantee here of any fair representation of the em-
ployers. I am sure that the Minister will see the workers are adequately
represented, and I have no dpubt that the independent members will be
carefully vetted, particularly in regard to their political sympathies. Is it
intended that the representati es of the employers shall be in the minority?
It is easy, if the Minister so wishes, to compose a development council in
such a way that they are in a minority, but they are the owners of the
industry, and although ownerShip counts for little in these days, they are
also the trustees for those wlho have invested their savings in the under-
But more important still, I am sorry to see that management is not
to be represented on these development councils. The employers are the
only category with practical and technical knowledge of the problems in-

Industrial Organization Bill [Mn. H. RHODES]

volved in the list set out in the First Schedule. How can it be suggested
that independent people, with no knowledge of the particular industry,
can make a contribution to the problems involved? I am sorry to say that
there are few workers who understand the intricate workings of industry--
Mr. Fairhurst (Labor): Why does the hon. Member make that statement?
Mr. Shephard: Well, the President of the Board of Trade himself said
it some time ago, and I have a good deal of experience of this matter. In my
own works, I have a consultation committee, and I encourage my workers
to the utmost to take an interest in my industry. But it is difficult, because
they have not had the training. I am not saying this in a deprecatory
Mr. William Wells (Labor): Does the hon. Member suggest that em-
ployers know more about the promotion or undertaking of scientific re-
search than scientists?
Mr. Shephard: No, certainly not, but I do not think scientists are en-
visaged as people to be co-opted. [HON. MEMBERS: "Why not?"] Because
I presume that the independent persons are to be representative of the con-
sumer interests, and not come from any particular technical side. What
worries me is that if the independent persons and the workers are in the
majority, experience as represented by employers will have to give way
to theory.
In my opinion, there is a much simpler solution to this problem. Give
the existing trade organizations the opportunity of implementing the
recommendations of their own working parties. Let each industry set up
its own body, and the President of the Board of Trade or Minister con-
cerned appoint to it a high grade civil servant. Let that civil servant live
in the area in which the industry is situated. Let him remain there,
divorced, as much as possible, from Whitehall, so that he can absorb the
realistic atmosphere of the industry. Let him spend his whole time study-
ing that particular industry. He will then gain practical knowledge, and
know the problems and difficulties of the industry and be able to advise
the Minister accordingly. The President of the Board of Trade has fre-
quently talked of the Government coming in as a third partner. That,
to my mind, is the way in which it can best be done.
Mr. H. Rhodes (Labor): I do not wish to detain the House long, as it
would not be fair, but in answer to the hon. Member for Newark (Mr.
Shephard) may I say that when the taxpayer is called upon to subsidize
the re-equipment of industry he should be given representation on the
council which is set up to deal with that industry? The problems follow-
ing the recent war are very peculiar, and must be taken into account in
the endeavor to find out whether we can even do without these councils.
Before the first World War the scientific problems were mainly on the
chemical side. The Germans solved those problems and when war broke
out we were concerned with the development of dyes, optical glass, glass
for the routine testing of steel, photographic equipment, and pharmaceu-
tical wares. It was only in the 1920's that we set up research associations

House of C mmons, February 13, 1947

to go into chemical problems and in the first two years of the recent war
we were dashing about with our gasmasks. Again, it was the Germans
who found a new technique. When their tanks came rushing through
France and Belgium we realized,- for the first time, that our problems were
not now chemical, but physical and mechanical.

In the textile trades, to which I have the honor to belong, the position
was something like this: in the cotton industry creaseless fabrics were dis-
covered; in the woolen industry non-shrinkable wool was discovered; vis-
cose and acetate rayon were developed; developments were made with
groundnut protein fibre. Anyone who has anything to do with research
knows that its cost is not more than one-eighth or one-tenth of the cost
of putting that research into practical application. Between the wars,
private manufacturers came in to support research organizations. In the
woolen trade, the maximum income in 1939 was 38,000, and in the cot-
ton trade it was 80,000. To do what is required today, to put the knowledge
we have of pure research into practical use, 800,000 is wanted for the
cotton trade, and 390,000 fqr the woolen trade. If we do not get it we
shall not succeed. How will it be done through the development councils?
I do not think that the present proposals go far enough; I think it will be
a question of too little and tob late. The influence of German mechaniza-
tion has put Switzerland in the forefront. The need today in our textile
industries is for re-equipment. Can it be done for the textile industry,
which will have development councils with no more behind them than
100,000 in 12 months? I do hot think it can.
The power of pure research should not be stifled, although it need not
have the prominence that it has had in the past as against mechanics. Why
not have a development council to serve the whole of the textile trade in
the matter of pure research and mechanics? The hon. Member for Read-
ing (Mr. Mikardo) said that some industries were vitally concerned one
with another, and unless there is a resilience with flexibility and under-
standing between one industry and another on these councils, they cannot
possibly succeed in their endeavors. If there were smaller councils with a
larger overriding council to co-ordinate the pure research and the mechan
ical side of all textile industries these problems could be considered
together. The smaller councils could decide the particular problems con-
cerned with their own branch of the industry, and the overriding council
could deal also with the ancillary trades and services.

I congratulate the President of the Board of Trade on the standard he
has set for industrial design. If industrial design were given its chance
in the development of textile machinery during the next 10 years, it would
change the lives of the people in Lancashire, Yorkshire and the Midlands.
In the past, the machine has been the juggernaut of the textile worker.
The trade unions in Lancashire would tell you that the majority of the
claims for compensation are due to "stretching." The Swiss and the Ameri-

Industrial Organization Bill [WING-COMMANDEB SHACKLETON]

cans have got in front of us in the design of machines. There is then a
great opportunity for industrial design in the new field of textile machinery.
I would like the Minister to answer some of these questions when he
comes to reply. How does the Bill link up with Statutory Rule and Order
1614 of January of last year and with the grants from the Department of
Scientific and Industrial Research and again with the 1 for 1 grants
from the Council of Industrial Design? Will the development councils
link up with the art schools and the training of industrial designers? Can
he say what has happened to the proposed college for the training of
industrial designers? Will it be possible for an industry to remove the chair-
man of a development council? I believe that if we can go forward with
these councils on the right lines we need have no fear of competition from
Switzerland, America or anywhere else in the textile world.

Mr. A. Hurd (Conservative): In Clause 1, the Minister of Agriculture
is given power to make an order establishing a development council. We
have already an Agricultural Improvement Council, which sits at the
Ministry of Agriculture, drawn from farmers, farm workers, and technicians.
It has branches in every county under the war agricultural executive com-
mittees, and they are called technical development committees. The em-
ployers and workers are represented on those committees, and, as a team,
they have enabled agriculture to make great advances in the application
of science and better technique, since they were formed in 1941. There
is also at the Ministry of Agriculture a body called the Council of Agricul-
ture. There is a Council for England and another for Wales. They also
bring together the three partners in the agricultural industry-the land-
owners, the farmers and the farmworkers. Under the Agricultural Bill,
now before the House, these two councils are to be abolished. I and some
of my friends in the farming industry are wondering what the intention
of the Minister of Agriculture is under this Bill. Does he mean to set up
yet another council in addition to the Agricultural Improvement Council?
We must be careful to guard against the danger of overloading agricul-
ture, or any industry, with too many committees. Many of my farmer
and farmworker friends are sitting two days a week on committees, some of
them engaged in useful work; but a good deal of it is paper work. I am
reluctant to see so many of the best men in the agricultural industry-
and no doubt this also applies to urban industries-being expected to de-
vote an undue amount of their working life to sitting on committees advis-
ing other people how to run their businesses. That is a danger, and I
would ask the President of the Board of Trade to throw a little light on
that point.
Wing-Commander Shackleton (Labor): Most of the objections to this
Bill seem to come under two headings. One, the objection to the detailed
proposals, and, two, the objection to the nature of the Enabling Act which
gives certain powers to the Government. I would like to deal, first of all,
with the need for the Bill. We have heard so often from hon. Members
opposite the need for the workers to work. It is true also that we should

House of (ommons, February 13, 1947

have more manpower, but tat will only be a temporary solution to our
problem. The real solution to the problem which we have to solve is
efficiency and more efficiency in industry. This Bill is the first step in that
direction. That must be realized and accepted by hon. Members opposite,
who belong to a party which under the Coalition Government accepted
that Government's White Paper on full employment.

I am hesitant today to mention the fact that we are entering an era of
full employment, but, in general principle, the Government are follow-
ing out a policy based on fill employment economics. That means that
no longer do the old theories of classical economy apply in industry. No
longer will the inefficient producer be shaken out of an industry by his
more efficient competitors. If we succeed in ironing out the slumps, there
will be no easy way in which to get rid of the inefficient producer in in-
dustry. It is vital, indeed, that the worker should not be subjected to this
sort of thing from which he suffered in the past. The fact remains that
we have to take further steps to achieve efficiency in industry by all means.
This matter was considered before the war, and the right hon. Mem-
ber for Bromley (Mr. H. Malcmillan) was a very strong advocate of some
form of Industrial Reorganization Enabling Act. He said in his book
The Middle Way-and I hope hon. Members opposite are not tired of
having it quoted at them-
"I submit that if the case for enabling powers for the cotton industry succeeds,
there can be no valid objection to making the same powers available to other
There is no Clause in this Bill which was not contained in the 1939 Cot-
ton Industry (Reorganization) Act, and the drafting is very similar. When
the Bill was introduced with much eloquence by the former President of
the Board of Trade, the right hon. Member for West Bristol (Mr. Stanley),
he produced an unanswerable series of arguments for the need to get ef-
ficiency into the cotton industry. We know that the cotton industry does
require that, and already steps are being taken to meet the need, but it
applies no less to many other industries in this country. I suggest that
this Bill, which I most heartily welcome, is a step in the right direction.
It does not impose a fixed pattern which would be set on each industry;
what it does do is it gives to the Government the power to take the neces-
sary steps to encourage efficiency, because it is vital that we should do
this now.
It is not a matter that we can treat lightly nor one with which we can
deal leisurely over the years, introducing one Bill at a time. It is some-
thing that has to be done very rapidly, and this Government, unlike pre-
vious Governments, does pay attention to the reports of inquiries which
they set up. If a previous Government had paid attention in 1923 to the
Sankey Commission we should not be in the disastrous position we are
in today with regard to coal. I suggest that it is vital that we should ac-
cept recommendations of the Working parties, which by and large have
recommended that certain action should be taken by the Government.

Industrial Organization Bill [MR. OSBORNE]

We feel that those proposals are best met by the present Bill before the
I would just refer to one point made by the right hon. Gentleman the
Member for Aldershot (Mr. Lyttelton), who complained of the appoint-
ment of outside members to serve on the board. He said that it would take
them a year to learn their job. This objection coming from a member
of a party which is probably the largest group from which companies
draw their guinea pig directors seemed to me as irrelevant and uncalled
for as were many of the irrelevant objections which he made to the Bill.
There was one other objection which he made when he attempted to
conjure up the bogey that the Government, the President of the Board of
Trade and the development councils would spoil and interfere in indus-
trial relations. The good employer, the efficient industry like some of the
big monopolies have given a lead on this, and they have shown that it
is possible to develop working conditions and improve conditions in fac-
tories by the proper utilization of labor far ahead of any statutory provi-
sions. I do hope that one of the gains that will come from this Bill will
be an improvement of conditions in industry for the workers. Naturally
it will be done in consultation with the Ministry of Labor, and at the
same time the fullest use will be made of the existing organizations, par-
ticularly the joint industrial council.
In conclusion, I should like to add one small criticism to my remarks.
I should like to emphasize the points which were made by the hon. Mem-
ber for Reading (Mr. Mikardo) in regard to the need for a certain amount
of co-ordination. Some of us on this side of the House have some doubts
as to the efficacy of the Board of Trade to control, direct and assist, as it
must do, the activities of a large number of development councils. I hope
they will give consideration to that problem. For instance some of the
services which are recommended for the development councils have much
in common. There is market research which might very well be done by
some national organization such as Betro. I do not wish to detain the
House any longer. I should like to welcome this Bill because it is abso-
lutely necessary in times when it is vital that we should increase the ef-
ficiency of our industry, and I hope that the House will give it a Second
Mr. C. Osborne (Conservative): The hon. and gallant Gentleman the
Junior Member for Preston (Wing-Commander Shackleton) referred
largely to the cotton industry as did the two speakers before him. I want
to refer to the two principal Leicester industries, hosiery and boots. The
first claim that we make for our industries is that they are by no means
inefficient and I think that the working parties' reports will bear that out.
When the President of the Board of Trade was introducing the Bill I took
some notes. He said first of all that the private companies now had an
opportunity to bring themselves up to date. Many of the private com-
panies, which are our smaller industries, resent that. We think we are up
to date and results prove we are. The right hon. Gentleman went on to
say that there were three partners in industry-capital, labor and the con-

House of C mmons, February 13, 1947

sumer-and that a very great increase in efficiency was necessary. That is
quite true; and I want to t rn to this point, that while working parties
have been investigating the contributions made by capital, my friends in
the two industries I have mentioned have believed that it is high time
that some working party made an investigation into the efficiency of the
second factor, namely, labor. I am not talking about the contribution
which labor makes at the bonch, but rather the trade union side.
Wing-Commander Shackleton: What does the hon. Gentleman mean by
the efficiency of labor? Does he mean efficiency in the workshop or ef-
ficiency in trade unionism oq the negotiating side?
Mr. Osborne: I think I said what I meant, and if the hon. and gallant
Member had been listening tb me he would have found that I was quite
clear on the point.
Wing-Commander Shackleton: Would the hon. Member make it perfectly
Mr. Osborne: If the hon. and gallant Member will allow me to make
my own speech I will proceed. Clause 2 (2) says that:
"A development council shal consist of . .
(b) persons capable of representing the interests of workers in the industry."
I think that is the crux of the whole Bill from a practical point of view,
because, unless there are trade union leaders elected who are able to carry
the workers with them, that Clause is going to be worth nothing. Our
experience on both sides of the House, as revealed by strikes at the present
time, shows that the weakness in the trade union organization is exactly
that there is no person or group of persons who can speak for the workers.
Hon. Members: No.
Mr. Attewell: Would the hon, Gentleman say that with regard to the two
industries in Leicester which he has just mentioned?
Mr. Osborne: If the hon. Gentleman would allow me to finish, I am go-
ing to bring that in. In the Leicester boot trade under the existing con-
ciliation boards we have had no strikes since 1894. Why bring this Bill
in to try to do a job which has been efficiently done for the last 50 years,
and find jobs for the boys to have it done? My point is-and I am sure
the President of the Board of Trade will agree-that every unofficial strike
since 1940 has been the result of the so-called leaders not being able to
speak for the workers whom they represent. I think we are all agreed on
that. [HON. MEMBERS: "No."] Oh, yes. There has been no official strike
since 1940, and every strike we have had has been an unofficial one, where
the nominal leaders have not been able to speak for the men they are sup-
posed to lead. The weakness of the position, as I see it, is that once a
trade union leader-and we have a trade union leader sitting opposite-is
put in a position of authority, and once he has learned what can and can-
not be done, he is all the time looking over his shoulder to see if the next
fellow, who is jealous of his position, is going to cause an unofficial strike
and so put him out of his job.

Industrial Organization Bill [MR. OSBORNE]

Mr. S. O. Davies (Labor): I understand that the hon. Gentleman holds
the trade union official responsible for unofficial strikes. In view of that,
does he not give that official some credit for the fact that no official
strike has taken place, as he has admitted, for several years now? What is
the explanation of that?
Mr. Osborne: The country does not care two hoots whether it is an official
or an unofficial strike. The evil is the same. What I want to emphasize
is the very practical point that as soon as we have a trade union leader
with great experience he becomes anxious because of the responsibility put
upon him. He is always looking behind him for the gentleman who will
jerk him out of his job.
Sir S. Cripps: The hon. Gentleman is repeatedly saying that he is sure
that I agree with him, but I should like to say very emphatically that with
regard to the two trades he has mentioned I entirely disagree. He has given
two specific instances of industries in which the trade unions have exercised
an admirable control and restraint upon their members. In both cases, the
trade unions concerned are headed by men who are real statesmen in in-
dustry, a fact which is constantly being brought home to me by the em-
ployers in those industries.
Mr. Osborne: I entirely agree with the right hon. and learned Gentleman,
but can he say that the same applies in the Transport and General Workers
Union down at the docks?
Sir S. Cripps: This is not a question dealing with the docks. I thought
the hon. Gentleman was concerning himself with the two industries in
Mr. Osborne: Indeed I am, but, with regard to those, we say that the
organization which we have already has worked in the boot trade since 1894
with great satisfaction, and we ask why scrap it and superimpose some-
thing else which will cost a lot of money and involve loss of unnecessary
Sir S. Cripps: The hon. Gentleman asks "Why scrap it?" There is no
proposal to scrap anything at all, and if he will read the report of the
working party he will see the arguments in favor of such a body as is
Mr. Osborne: I agree again, but if the right hon. and learned Gentleman
admits that in our two industries the trade union officials have been states-
manlike and the employers reasonable, why does he want to interfere at all?
Sir S. Cripps: Because both the employers and the trade unionists want
a body of this kind.
Mr. Osborne: That, Sir, I doubt.
Sir S. Cripps: It is stated in the working party's report.
Mr. Osborne: May I say that what we feel in the industry-of which I have
some knowledge-is that this Bill is largely unnecessary as far as our two
industries are concerned. It will tend to weaken organizations that have
done a good job in the past, and we would much rather go on with the

House of C mmons, February 13, 1947

voluntary organizations that have stood the test of time than have this
thing thrust upon us. I sho ld like to conclude by repeating the main
criticism, that as the experie ced trade unionist becomes more and more
a statesman he also falls more and more out of step with the men behind
him. I do not think that the right hon. and learned Gentleman will find
the men to do the job he is asking them to do under paragraph (b) and
which is so vital to the industry. If he does not the whole thing will break
Mr. Scott-Elliot (Labor): I will not detain the House unnecessarily, but
I want to refer to the remarks made earlier this afternoon by the right
hon. Gentleman the Member for Aldershot (Mr. Lyttelton). Towards the
end of his speech I tried to persuade him to say what alternative he had
to suggest to the proposals contained in this Bill. I think it will be gen-
erally agreed that some forward movement is needed, whether it be by the
older voluntary bodies or by the statutory organizations that it is proposed
to set up. The right hon. Gentleman contented himself with saying that
there should be direct contact between industry and the Government. Let
us analyze that and see precisely what it means, because the right hon.
Gentleman was very woolly on the subject. In the first place, it may be
said that the Joint Industrial Councils would do this work but they have
hitherto been regarded as dealing with wages and conditions which are
Ministry of Labor questions and not with Board of Trade matters at all.
I feel, therefore, that we are driven to assume that what the right hon.
Gentleman had in,mind was the trade associations: if he meant trade asso-
ciations it would rest with them to bring in the workers. They would be
the prime movers and they would ask the trade unions to come in with
Where is that going to lead? It will be the employers, on their own in-
itiative, who will be doing this, and the trade unionists will be put in a
subsidiary position. In other words, we shall not be having anything like
the proposed national approach to the subject-the tripartite approach
which is envisaged and recommended in every single working party report.
The right hon. Gentleman seems to disregard the fact that in the case of
cotton, pottery, hosiery, footwear, furniture, jewelry and silverware-I
think those are the reports that have so far come in-every single working
party has recommended some fprm of tripartite organization. I think that
that is one of the main arguments in favor of a Bill of this kind.
I should like here to quote from a report of the Federation of British
Industries which was issued iq October, 1944, and which envisaged just
this kind of thing. It went through a list of functions which had to be
fulfilled. I have not time to read them now, but they include the very
things contained in the First Schedule of this Bill. What did the report
say? It said:
"Unless industry sets up a suitable organization the Government will be com-
pelled by pressure of circumstances to devise methods of its own."
That is exactly what the right hon. and learned Gentleman the President
of the Board of Trade is doing. What has been done by these industries in
the 18 months since VJ-Day? ton. Gentlemen on the other side of the

Industrial Organization Bill [MR. JENNINGS)

House have risen one after the other to say, "We do not like it," but I
ask them, "What have you done to implement these recommendations of
the F.B.I.?" In case any hon. Gentleman should say so in reply I agree
right away that the F.B.I. is mainly concerned with the engineering in-
dustry, but I believe nevertheless that the line which the Opposition have
been taking in this Debate is mainly based on this report.
I should like to say a word about the question of nationalization which
has been set up as a kind of bogey by the right hon Gentleman. It is just
another example of putting forward capitalist theory instead of facing
practical reality. Let us see precisely what the position is. Why were
these working parties set up? They were set up because my right hon.
and learned Friend wished to secure greater efficiency in industries which
he himself said were not to be nationalized. And what did the working
parties report, since my right hon. and learned Friend has said this after-
noon that the Government will have very great regard to what the work-
ing parties put in their reports? In every instance the working parties have
reported against nationalization and have expressed themselves in favor
of setting up a tripartite body to carry on the excellent work which they
have themselves been doing. That seems to me to be the crux of the matter.
I wish to say a word about a point that has been raised in respect of
employers who wish to have control over the development councils be-
cause it will be they would have to pay a levy. I see clearly the point
made by the right hon. Gentleman the Member for Aldershot (Mr. Lyttel-
ton) when he used the words, "No taxation without representation." But
this again is very largely theory. Let us see what in practice will really
happen. The levy will be exceedingly small. The maximum figure will
be laid down in a Board of Trade Order and the Board of Trade are, after
all, the fathers of industry and they will obviously have regard to the kind
of levy that the industry can pay. Moreover, and this is a very substantial
argument, the object of the levy is not to increase the cost of production
but to reduce it by means of greater efficiency.
The line that has been adopted by the right hon. Member was essentially
an employer's line, an old-fashioned line, a line which I trust had gone
once for all as a result of the election of this party as a Government. It is
no longer for employers to say: "This is our industry. We intend to do what
we will with our own." It is a very different case today. Industry must be
conducted henceforth in the national interest. The day of national co-
operation has come. I believe there is to be. a real partnership in industry
between employers and workers. Only thus shall we go forward as a great
industrial nation. Because I believe the Bill is to implement that policy
I hope it will receive a Second Reading by a very substantial majority.

Mr. R. Jennings (Conservative): There are some points that worry me
ab6ut the Bill, and the first of them will strike at the very foundation of
the proposals of the right hon. and learned Gentleman. It is that working
parties do not fully represent the people in the industries concerned. In
my Sheffield cutlery industries, I was approached and was told by some

House of C mmons, February 13, 1947
constituent firms that they ere called to meetings but were very busy.
They were getting on with e port work and doing all they possibly could,
and they could not attend so e of those meetings. People who did attend
were brought into very active and open discussion with regard to the
working parties. Without any ill desire on the part of the right hon. and
learned Gentleman, there has been, I believe, an atmosphere of hesitation
in industry. It started when the Government set out to nationalize certain
industries, and the feeling was that industry was to be brought up to date.
Owners of businesses really began to wonder whether they owned those in-
dustries and businesses or not.
That is the wrong way to get the best out of the owners of individual
businesses. They did a first-class job of work during the war and brought
us to victory by their maximum production efforts. I put forward my view
with some reserve, because the right hon. and learned Gentleman is in a
far better position to know the exact situation. I have had a pretty good
experience of the working pa ties in Sheffield. Whatever their reports to
the right hon. and learned Gentleman, they did not in many instances
properly represent the state ofi affairs in that industry. I listened carefully
to his speech. He put the matter clearly. I take it that the Bill was very
largely brought about by the recommendations of the working parties, but
I do not believe that the working parties represent the major portion of
the people employed in the industry.
Sir S. Cripps: No doubt the hon. Member is aware that members of
the working parties were appointed on the nomination of employers'
federations on the one hand and trade unions on the other. I do not know
what better way we could choose to make them representative.
Mr. Jennings: That looks all right on the face of it, and I give the right
hon. and learned Gentleman full marks for putting over very clearly, and
making so simple, the point that it has been agreed by the employers and
the workers. The industries were first of all rather threatened-if I may
use a strong expression without any suggestion of offense-that if they did
not take action then something violent would happen. It was rather taking
the big stick to industry. The right hon. and learned Gentleman will not
repudiate this. The whole atmosphere of this Measure is colored with his
political views. It is taking control from the directors and the managements
of particular industries and placing it in the hands of council. To whom
do these businesses belong? To the Government, or to the people who own
them and have their capital invested in them?
Sir S. Cripps: The hon. Gentleman is asking me the question. There is
no provision whatever in this Bill that takes any control out of the hands
of directors and puts it into the hands of councils.
Mr. Jennings: If that is so, I should say that the substratum of the Bill
has gone completely. If it is not for the purpose of making recommenda-
tions and suggestions for the carrying on of industry, what on earth is the
good of the Bill at all?
Sir S. Cripps: The answer is that it will make suggestions and recom-
mendations, but that does not mean taking over control.

Industrial Organization Bill [MR. MALLAuEU)

Mr. Jennings: The Government are taking power to levy industry, which
will be forced to pay. If we do not pay, the Chancellor may have power
to send us to gaol. We have got to pay. The right hon. and learned Gen-
tleman, with his great legal mind, cannot just wangle and worm round
that one. I do not want to get beyond the rules of Order but I feel that
my point of view cannot be rebutted so easily as that. Industry has to
supply to the proposed councils certain information. The Minister was
questioned from the Benches here when he made his speech as to the kind
of information that had to be supplied to those councils. Was it to be
passed on from one competitive firm to another? I see great danger in that
sort of thing.
Let us have the thing in proper perspective. It is no use telling the
country that everything in the garden is lovely; it is not. [HON. MEMBERS:
"Hear, hear."] I am very pleased to hear those cheers; if hon. Members
will come to Sheffield, where there is no coal, they will get some more.
There is in the minds of many people in this country a feeling of suspicion
and an atmosphere of apprehension. What is behind this Bill? Now that
the Government have perhaps spent their nationalization power for the
time being, are they going to exercise control in another form? Are they
bringing in this Bill in order to get information from industries, with the
suggestion by the right hon. and learned Gentleman that it has been asked
for in the working party reports, and are these councils going to be properly
representative of labor and capital with an independent chairman? In a
free country, before the Government have any right to take or to exercise
any control over any man's or any company's business, they ought to come
out into the open and say so, and not do it in this roundabout way. But
they come to this House in a plausible manner, and to every objection that
is raised they say, "It has been called, for, the working party recommended
it." The right hon. Gentleman told my hon. Friend a short time ago that
the employers and employees in his industry in Leicester have asked for
it, but I suggest that in many cases the working parties are not truly rep-
resentative of the particular industry.
I listened with great respect to the hon. Member for East Woolwich
(Mr. Hicks), who has a great knowledge of industry. I have been here
some years with him, and I respect his views. He said that there was a
tendency in the country in the last few years for parents to tell their boys
not to go into industry, but to get a white-collar job, an office job, a bank
job and so on. Then he said that we are now faced with a shortage of
manpower. I would like to ask the President of the Board of Trade, and
the Government, how many white-collar workers they are bringing into
existence in the Civil Service today? They are taking out of productive
industry and putting into the Civil Service so many people that the Gov-
ernment will be destroyed by it.
Mr. J. P. W. Mallalieu (Labor): I do not propose to follow the hon.
Member for Hallam (Mr. Jennings) into the morass into which he has
thrown himself with his usual vigor. I will pass at once to one of the
criticisms of this Bill which I do not think has been made in the Debate
so far. It is about the power of these development councils to demand

House of Commons, February 13, 1947

statistics. I am in favor of getting all the information we possibly can,
but I think there is a danger of asking for the same kind of statistics too
often, and I am afraid there may be some duplication between what is
asked for under this Bill and the census of production which is now to be
taken. So I would ask the President of the Board of Trade or the Par-
liamentary Secretary to make clear that provision will be made to avoid
such duplication. I know that the manufacturer is overburdened with
forms and has been for a very long time, and we want to do nothing to
add to that burden.
I wish to make one or two general points about the Bill and then I
will sit down. It has been the constant plea of hon. Members on the op-
posite side of the House that we should not yet set up these development
councils but should leave it to the industries themselves to try and sort
things out for themselves, and see how far they can get with joint industrial
councils and the rest. It seems to me that we have been trying just that
for a great many years, that we have had to wait a very long time for im-
provement, and that it has not been forthcoming. Now the situation has
become really urgent.
Take training, for instance, which is to be part of the job of the develop-
ment councils. Far too often in the past a man or woman has learnt a
job simply by watching somebody else. A person has learnt weaving by
watching a skilled weaver, but I think many hon. Members will agree that
that is not necessarily the best way of learning, because a skilled weaver
is not necessarily a good teacher. It has been the habit in the woolen
and worsted industry to learn that way, but now one or two firms are
beginning proper training schemes. Three months ago I went to see a
firm in Leeds where they have a first class training scheme, with machines
set apart for the trainees, regular courses of lectures and so forth, trying
to give each person who comes into the industry an idea of every process
and of the place each process has in the industry. That sort of thing
needs to be tremendously stimulated, and I believe the development
councils will do it very well.

I am a little more doubtful about the possibilities of success in some
of the other aims they have, for example in the standardization of cer-
tain products. We must be very careful about standardization; we do not
want too much of it in the West Riding industry, certainly, though there
are some spheres in which standardization is essential-in little things
like nuts and bolts, for example. A great variety of nuts and bolts are
used on looms; there is the Northrop type, the Whitworth type, and sev-
eral others, with the result that if a turner wants to get hold of a nut he
cannot just reach into a box, but must go scraping around the mill to
find the exact type, involving a considerable waste of time. We want to
see these things standardized, but I think the development councils and
the President of the Board of Trade himself will strike snags in their

Industrial Organization Bill [MR. MALLALIEU]

efforts to get standardization. I remember that not so very long ago some
technical experts recommended to a very famous firm of loom makers that
they should make some changes in the type of loom they produced. But
the head of the firm rejected the proposal not on the ground that the
changes would not be beneficial, but that they would interfere with his
trade in old spare parts. He had a sort of vested interest in selling spare
parts for the old loom. I am afraid the development councils will run up
against objections of that kind, and I am a little doubtful whether, in
their present form, they have sufficient powers to overcome them. I am
not quite clear just how much control the councils really have.

Turning to conditions, we were left a little vague by the statement of
the President of the Board of Trade as to how far the development councils
are to be concerned with that subject. In the woolen and worsted in-
dustries at the present time two of the many things that are bad about
the conditions of working are lighting and the general drabness of the
mills. There are still bad employers in that industry who do not realize
the necessity for good lighting and bright surroundings to work in. On
the other hand, there are good employers who not only realize it, but who
are trying to do something about it. Their problem is that if they want
to put in new types of lighting, or to redecorate the walls, they are unable
at the present time to get either the lighting equipment or supplies of paint.
What these good employers require is not exhortations from the develop-
ment councils, but a spot of priority to help them get the supplies they
need. Perhaps it is the intention of the President of the Board of Trade to
give the development councils power to allocate priorities. If that is so,
it will be a very good thing indeed, but it is something which needs to be
done urgently and quickly, and that applies not only to lighting and color.
Another great trouble in our industry in Yorkshire, and in many other
industries in the country, is that it is housed in many instances in very
old buildings. I went round a firm in my constituency, towards the end
of last year, where the owner, the master, told me that the building was
so rickety that he could only run the cards at half speed. It is no good
telling such a man that his firm is inefficient, when the only way to make
it efficient is to get new buildings. What is needed is some body in each
industry which can give priority, which can say, "This mill needs com-
pletely rebuilding," or, "This mill is good enough as it stands," or, "This
mill can be improved with special machinery"-some body which is look-
ing at the industry as a whole and giving priority for new building, new
machinery, new equipment of all kinds. If the development councils are
to have that power, I think the Bill is a good one, but I am a little bit
afraid that, although the Bill is well intentioned, it is too leisurely. The
situation, as far as our industry in Yorkshire is concerned, is really urgent.
We are desperately short of labor, particularly in the spinning section,
and furthermore, in about a year, a year and a half, or two years, we shall
face the end of the sellers' market and there will be fierce competition from
abroad. If we are to find the remedy to both those problems, to get the

House of Commons, February 13, 1947
labor back now and be ready in two years' time to face competition from
abroad, we have got to take more drastic action than seems to be possible
under this Bill.

Colonel Lancaster (Conservative): I am glad to have an opportunity
of saying precisely why I consider this to be a bad Measure. It is evident
that the intentions of this Bill are common ground between the two sides
of the House. I do not think that any hon. Member who has spoken today
has seriously denied that practically every one of the functions in the First
Schedule are desirable objectives. Where hon. Members on this side join
issue with the Government is the means by which those functions are to
be implanted on industry. I was very interested in the speeches from the
Government Benches of the hon. Member for Elland (Mr. Cobb) and the
hon. Member for Reading (Mr. Mikardo). Both those hon. Members spoke
with knowledge and considerable experience of labor relationships and
of the general principles underlying the intentions behind the Bill, but
in their speeches I thought I detected, behind their political allegiance,
doubts as to whether this statutory approach is desirable and is necessarily
the wisest course.
I believe we should be well advised to consider whether working parties
set up at a particular time for a particular purpose, during what the hon.
Member for Huddersfield (Mr. Mallalieu) expressed as a time of sellers'
market, are necessarily a yardstick by which to set up some comparable
machinery at a time when we are fast approaching a buyers' market. The
very standardization of their approach to this problem is something which
fills me with some alarm. I cannot believe that every time we are con-
fronted with an industrial problem, whether of integration or of introduc-
ing a whole series of admirable reforms such as are suggested in this Bill,
it is necessary to set up entirely fresh machinery. There seems to be a
feeling on the following lines, "Reorganization is necessary, there is no
other means of reorganization in this particular field, and we can only bring
this about if we set up a statutory body, the development council."
For some considerable period now we have found by experience,
gradually and progressively, both on the part of trade unions and trade
associations, that joint industrial councils are proving their worth, and are
bodies which, with additional functions and a wider scope of endeavor,
could well be used to implement the intentions behind this Bill. I do
not believe that to enforce matters of this sort will necessarily bring any
sound results. For some years now I have watched the working of this sort
of thing on quite low levels, the working of pit production committees,
where matters affecting the welfare of the people taking part in those com-
mittees are slowly thrashed out on the soundest level-the bottom rung,
where practical work is done-and though a great deal of nonsense is talked
and time is taken up by dealing with rather irrelevant matters, neverthe-
less the germ of a sound idea very often appears, and in due course has
practical effect. I do not discount the work which that type of body has
done, and I do not discount the work which the joint industrial councils
are capable of doing.

Industrial Organization Bill [MR. AWBEBRY

I believe that the Government should discard their theoretical approach
to many of these problems, and have confidence in the good intentions of
industry-there are, of course, bad industrialists as there are bad trade
unionists-and that on the whole industry is anxious to avail itself of the
opportunities which we hope in due course will lie ahead, industry needs
to carry out a great many of these improvements, but industrialists, like
trade unionists or, indeed, anybody connected with industry, are more
able and more likely to give these things practical effect if it is done on a
voluntary basis.
I do not say this because I want the purposes of this Measure to be
avoided. I do not think they should be avoided, because they are devel-
opments that need to be put in hand and are things that would be to the
general benefit of the industry, but I cannot bring myself to believe that
the sanction of the State is required for their implementation. I believe
we have to go on trusting people, trusting to the good intentions of the
industrialists and the trade unionists, trusting to the experience and the
record in a great many industries of joint consultation on all sorts of levels,
with the guidance and authority behind them of the Board of Trade and
the various Government Departments interested, to bring about these re-
forms, and to do so in a way that will ensure the enthusiasm and the full
support of the people who, in the last resort, have to make a success of it.
I am not all that anxious to see independent members serving on these
bodies. If we are to get results, it must be on a very practical basis, and
unless the independent members become so submerged in the industry that
they become practical men, I believe their contribution will be a very
limited one. I would be much happier to see a bridge between the two
sides of industry-not a tripartite body but between trade associations and
trade unionists on a joint basis approaching this problem with the same
intentions and a common endeavor. It is in this way that we should get
better results rather than by the powers inherent in this Bill.
The President of the Board of Trade is so able and so pursuasive. As
I listened to his speech I began to wonder if there was anything to be
frightened about in this Bill and if the doubts and uncertainties I have
had during the last few weeks were unfounded. But gradually as his speech
developed the manner in which the right hon. Gentleman spoke and the
way he avoided the points which had caused me concern confirmed the
views in my mind, and I shall divide against the Second Reading of
this Bill.
Mr. S. Awbery (Labor): I rise to give my full approval to the Bill in-
troduced by the President of the Board of Trade and to assure him that
he has behind him the majority of the trade unionists of this country. I
want to give the reasons why the trade unions will approve the establish-
ment of development councils, but before doing so I would like to answer
the right hon. Member for Aldershot (Mr. Lyttelton) who showed great
concern for the trade union movement and the present negotiating ma-
chinery, and was of the opinion that this Bill would destroy the machinery

House of Commons, February 13, 1947

now operating so well. I assure the right hon. Gentleman that this Bill
will neither undermine nor overlap any existing machinery now operated
by the trade union movement. In fact this Bill will supplement what the
trade unions are now doing. I say to him quite candidly that today in-
dustry is no longer the sole concern of the industrialists. It has now become
the concern of the nation, and, therefore, the concern of Parliament.
An hon. Member opposite made an attack upon the trade unionists
for lack of control in not stopping strikes. We know that strikes have
taken place unofficially, but the hon. Member does not know how many
strikes have been prevented by the trade union officials and movement.
In answer to a question in the House one day this week we were informed
that last year 4,000,000 days were lost through industrial disputes, whereas
in the year following the previous war, when no negotiating machinery
was operating, 14,000,000 days were lost.
I welcome this Bill, which, I believe, will be a forward step for the
industrial movement. One hundred and forty years ago we had the first
Factory Act, 60 years ago the Mines Act, in 1906 the Workmen's Con-
pensation Act, and now we have this Bill and we support it because of
what is mentioned in the Schedule. The functions which will be given
to the development councils appeal to trade unionists. There will be both
industrial and technical training for the industrial worker. In the past
this has been almost entirely neglected. A few advanced employers have
encouraged their young men to go to night school and technical classes,
paid their fees and fares and done everything possible for them, but they
have been the exceptions.
Under this Bill, technical education will be a part of the function of
the development councils. Next it appeals to the trade unionists because
it will secure better and safer conditions. I have seen industrial accidents.
I have seen men carried to hospital and to the mortuary. This Bill will
not compensate men for accidents in industry, but will prevent accidents
happening in industry. In 1945 there were 851 fatal factory accidents in
this country, and 239,000 non-fatal accidents. Many of those were pre-
ventable. There were 994 convictions in the courts, so it is evident that
a large number of them were preventable. These councils will prevent
accidents in the future, and they will provide amenities for the worker.
In the past there have been no amenities. I was in a works where there
was no cloakroom in which to hang up wet clothes on arrival in the
morning. There was no canteen, and I had to go to a corner of the shop to
eat my food. There have been improvements, but there is room for more.
These development councils will promote research into the cause, incidence,
and prevention of industrial diseases.
The fact that panels dealing with a number of industrial diseases and
their prevention have been set up has been mentioned in this Debate. I
worked in a factory in 1911 where one of my colleagues died an agonized
death from an industrial disease which was not scheduled. An inquiry
was forced by a trade union, and, as a result, the disease was scheduled,
so I am glad that the councils to be set up under this Bill will go into
the question of industrial diseases and try to get them scheduled. If we

Industrial Organization Bill [MR. SPENCE)

want an increase in our productive capacity, these things must be done,
and so I hope the Bill will be passed. The right hon. Member for Alder-
shot said that if we could assure him that the majority of the people in
the industry would agree with this Bill, he would support it. I can assure
him now, quite confidently, that all the trade unionists stand behind this
Bill, and as they are the majority in industry he ought to support the
Bill, too.
Mr. H. R. Spence (Conservative): I want to contribute only briefly to
this discussion because time is short. As a small specialist manufacturer I
want to make one or two remarks to the Parliamentary Secretary to the
Board of Trade. I shall follow the line taken by the hon. Member for
Elland (Mr. Cobb), who referred in the second part of his speech to the
fact-that the small manufacturer in business will not get very much out
of this Bill. I support that view, and I hope we shall receive from the
Parliamentary Secretary, when he replies, some reassurances as to how the
Bill will be applied to the small industries as well as to the big ones.
I do not propose to deal with the body of the Bill generally, to which
I have the strongest objections, as many of my hon. Friends have spoken
on this point, but I shall deal with a matter which arises in the First
Schedule. It lays down the purposes which the development councils are
to carry out. Paragraph 5 says that one of the duties is:
"Promoting the production and marketing of standard products."
I think there will be a grave danger in the operation of the Bill, when it
becomes law, if we tend to direct the production of the country generally
on standard lines. That would be a great pity. I believe that our great
reputation in the world today-and I say this from my own experience in
my own trade, which has been built up on specialized manufacture, in
the main-is due not to big producers, but to the man with brains, and
workpeople of the quality which has made our country famous through-
out the world. If we are to encourage only standard products, what is
to be done for the man who makes a small specialized line, which cannot
be regarded as a standard product? The Bill ignores the very valuable
fact that we have highly specialized products in almost every line, textiles,
engineering, and so on....
Paragraph 11 says:
"Promoting or undertaking arrangements for encouraging the entry of persons
into the industry."
This is one of the most useful objects anyone could have today. One of
the biggest problems of a manufacturer is to attract young people into
industry, and to make them realize that the welfare, wealth, and rising
standard of living which we want to see in this country, are dependent
on our power to produce consumer goods. Amongst our young people there
seems to be a feeling that any job is better than working in a factory. I
can quote from my own experience the case of a teacher who said to a
class of school children, "If that is all the good you are, you will only be
good enough to go into a factory." That should not be the psychological
attitude at all; it should be that the producer is worth more than the
parasite. That spirit should be inculcated by means of our educational

House of Commons, February 13, 1947

curriculum, in addition to the advertisements which the manufacturer has
to put out to try to attract young people into factories.
I would like the Parliamentary Secretary to reply to this point. Some
12 months ago we had a Debate on a Statutory Rule and Order on in-
dustrial research. That Order gave the Board of Trade authority to raise
500,000 in any industry for the purpose of industrial research. Is that
Order now to be dropped, does it lapse, does this Bill supersede it, or is
it a part of the Bill?
Mr. J. Diamond (Labor): Following the hon. Member for Central Ab-
erdeen and Kincardine (Mr. Spence), I find that my task is indeed light,
because throughout the latter part of his speech he argued in favor of the
Bill in almost every respect. In fact the only respect in which he was not
in favor of the Bill was on the question of standardization.
Mr. Spence: I said that I would not deal with the structure of the Bill,
to which I objected, but that if these councils were set up, these were the
things they should do. I am against the Bill, and I shall vote against it.
Mr. Diamond: I understand that hon. Members opposite intend to vote
against the Bill. Each hon. Member in succession has made that clear, but
no one has given any reason for doing so. I was not expecting the hon.
Member to do so when his Front Bench had failed to give a lead.
It seems to be agreed by both sides of the House that no objection can
be taken to the general objects, which are outlined in the Explanatory
Memorandum. They are:
"to increase the efficiency and productivity of their industries and to enable them to
render better and more economical service to the community."
Although I desire to support the Bill in a general way, I feel that it fails
to go anything like far enough in securing those most desirable objectives.
Many speeches have been made about the powers contained in the Bill,
and about the control that the Bill will thrust upon industry. That ar-
gument is without foundation. The only power in the Bill is to ask ques-
tions, to get on with it, and, it may be, sometimes even to get an answer.
In the very large number of items included in the First Schedule is
"2. Promoting or undertaking inquiry as to materials . ."
All those kinds of functions arise purely on the basis of asking ques-
tions and publishing the results. That is not adequate for the very reason
touched upon by the hon. Member for Hallam (Mr. Jennings), in his
interesting and forceful speech. He used words to indicate that the Gov-
ernment did not allow the owners of businesses to know whether they
were really the owners or not, and that owners of businesses were becom-
ing disturbed as to whether they could do just as they liked with their
own businesses. The sooner we make it perfectly clear that owners of
businesses are not, in this age, and in the state of the country today, en-
titled to do just as they like with their own business, the sooner will this
country get back on to its feet. They should treat themselves as trustees
of those assets, with an obligation to use them in the best interests of
their workpeople, and of the community as a whole, and not satisfy any
individual desire to treat them just as they think fit at the moment.

Industrial Organization Bill [MR. DIAMOND]

The hon. Member also said, I believe, "We do not want any inter-
ference, we think we are all right," in reference to the smaller businesses.
That indicates my point. That is just the trouble. The owners of smaller
businesses, on the whole, think that they are just right, that they are per-
fectly entitled to do what they like with their businesses. How, in that
frame of mind, are those business owners going to pay any attention to the
Board of Trade, or to a particular development council, when they are
asking questions the answers to which are to be published?
I do not think that that is adequate. I would suggest that the First
Schedule be increased in two respects. In paragraph 7 of the Schedule,
these words appear:
"Undertaking the certification of products . ."
I would like to see added "undertaking the certification of efficiency." I
would like it to be clearly established that it is part of the duty of a de-
velopment council not only to make inquiries as to the efficiency of a
particular unit in an industry, but also to publish the results in the form
that there should be established a register, on which all firms who desired
could go with a view to becoming adjudged efficient. When they became
adjudged efficient they would be entitled to put on their notepaper a little
stamp to that effect. That is quite a common procedure in business today.
Firms have all sorts of little stamps on their notepaper, certifying a variety
of things-that they belong to a trade association, that they adopt the
ex-Servicemen's scheme, etc.
That would be purely voluntary. I do not suggest for one moment that
any benefit can be obtained by forcing firms to do what they are not pre-
pared to do. Every benefit can be obtained by encouraging firms to realize
their own inefficiency, and persuading them to take the right steps to
alter that inefficiency. A register should be established and firms should
invite the Board of Trade-which has the machinery at its disposal in the
form of the production efficiency service-or industrial consultants to in-
vestigate their organization and establish their efficiency. I would go even
further and suggest that where returns from individual firms indicate that
the standard of efficiency is deplorably low, those firms should be invited
-not compelled-to call in either the production efficiency service of the
Board of Trade, or some practitioner in this field, to advise them on the
extent to which they could improve their efficiency.
I do not think that the powers in the Bill, which are more or less
negligible, will be sufficient to achieve what is desired. Inefficiency is at
its greatest not amongst the large, competent firms, who are able to en-
ploy people to see that the organization is efficiently run, but in the much
smaller firms who do not realize the extent of their inefficiency. Another
thing which I would like to see added to the First Schedule would be
words intimating that one of the functions should be the promotion of
industrial democracy. I cannot see that the meaning behind those words
can be read into what is already there. One is very concerned today with
incentives in industry. I am glad to see, for that reason, that the third

House of Commons, February 13, 1947

paragraph of the First Schedule recognizes the need to promote research
into matters affecting industrial psychology. I am assuming that incentives
will be covered by that.
So far as industrial democracy is concerned, it is absolutely vital today
that we should improve the relationship between employer and employee
and establish the right of an employee, by hard work, to go the whole
way up the ladder to the very top. At present the employee cannot do
that. I am sure the right hon. Gentleman the Member for Aldershot (Mr.
Lyttelton) will agree that members of boards of nearly every company are
drawn from a certain section and that below that there is a complete
vacuum. Underneath that vacuum, we find the ordinary worker. How-
ever capable he may have shown himself in his particular trade, business
or technique, he finds he can go so far and no further. That knowledge
kills his incentive. It is claimed that there is complete democracy in the
Army because every soldier carries a field marshal's baton in his knapsack.
That may, or may not, be so. What I want to see is the time when we
can claim that the chairman's hammer is carried in the tool kit of every
workman ....
Mr. W. S. Shepherd (Conservative): I think the President of the Board
of Trade will find little satisfaction in the Debate that we have had today,
because the volume of criticism of the proposals which has come both
from this side of the House and the other, must, I think, have been a
surprise to him. Very few hon. Members have given complete and un-
qualified approval to this Bill. The only hon. Member who did so, was,
I think, the hon. Member for East Woolwich (Mr. Hicks), and he, I think,
was under a complete illusion as to the purposes of the Bill, and imagined
that the redistribution of our labor force could be achieved by its means.
Indeed, each hon. Member who has spoken has found fit to criticize the
important aspects of this Measure. The criticism has not been upon the
minor points, but upon the very basis of the Bill, and that is something
which should cause the President of the Board of Trade some anxiety.
These proposals have been commended to us by virtue of the recom-
mendations of the working parties. The President of the Board of Trade
has paid a tribute, and, in some considerable measure, a very justified
tribute, to the work which has been done by these bodies. I would not
go so far as did one hon. Member in acclaiming the idea of the working
parties as an inspiration on the part of the right hon. and learned Gen-
tleman. They have, it is true, told a lot of people what most people in
the industry already knew. They have presented a picture, and I have
no doubt that, in that direction, they have performed a very useful func-
tion. Some of them have even told us what we already know. For instance,
the hosiery working party gave us the following momentous information
in its Report:
"Few things occupy a more permanent place in our national life at the present
time than stockings."
That was information known to most of us before this elaborate inquiry
was made. It is not my intention to criticize in any detail the working
parties, but I feel that many of the recommendations-in fact, nearly all

Industrial Organization Bill [W. S. SHEPHERD]

of them-fail in that they all lay down a set of circumstances and a set of
recommendations which will put our industries on their feet only with
the expenditure of a good deal of time and capital.
What this country is facing is not the problem of how by immense
mechanization and re-equipment it can put itself in order, but how it
can get production from the existing capacity. Under the present state
of affairs, there is no opportunity or prospect of our being able to afford
huge expenditure, either in terms of money or labor, for re-equipping our
industries. Moreover, there has been a tendency to accept the reports of
these working parties as gospel when they have been dealing with indus-
tries which are in an abnormal condition. In the main, the working
parties' reports deal with industries which have been contracted, and, in
many instances, a wrong balance and a wrong deduction may be drawn.
When considering the question of the relationship between industry
and industry, it is important to bear in mind that, at the present time,
there is a greater need for Government direction than obtains in the nor-
mal course of business. Owing to shortages, it is necessary to allocate
priorities and quotas, and to restrict entry of those things which operate
in an economy under present circumstances, but which do not necessarily
operate in an economy under normal circumstances. Therefore, there
should be some caution about rushing into the acceptance of recommen-
dations which are based upon an abnormal state of affairs. No desire
for the establishment of a stable economy should lead us to attempt to
perform by Government regulation what can be performed by normal
economic processes. That may be a doctrine which hon. Members opposite
are not prepared to accept, but it is one to which we on this side of the
House strongly adhere.

I want to contest the view put forward by hon. Members opposite
that our industrialists are incompetent. This view is far too often ex-
pressed by hon. Members opposite. Those who criticize our industrialists
should remember that those very industrialists have raised this country
to a very high standard of living. They have made it possible for a small
island, which normally would support a population one-fifth of its size,
to attain a position of pre-eminence in the world and to enjoy a standard
of living higher than any other country in Europe. That has been due,
in the main, to the energies and enterprise of our industrialists. [An
HON. MEMBER: "What about the workers?"] Yes, I readily include the
workers who, in the main, have a much higher standard of skill and de-
votion to duty than any other workers in the world. I have said in this
House before that one of our best assets is the stability of the workers in
this country and the manner in which they perform their jobs. However,
I do not want to go into that aspect at present. The question which
activates the minds of my hon. Friends and myself is whether, under the
new dispensation, it will be possible to maintain the standard of living
which has been built up by these condemned industrialists. That is the
question which many of us are thinking about today, and to which we

House of Commons, February 13, 1947
are by no means certain of the answer. The condemnation of industrialists
in this country is grossly unfair because on the whole, those industries
which are described as bad have been the victims of circumstances beyond
their control.
Reference has been made time and time again this afternoon to the
cotton industry. No single endeavor on the part of industrialists would
have avoided the catastrophe which overcame the cotton industry. It was
due to the industrialization of other countries and the loss of overseas
markets. No amount of ingenuity or enterprise would have saved that
situation. What is more, a good deal of decay which set into our indus-
tries during this century was due to the fact that we held on to a policy
of free imports long after our economy had been able to stand it. It is
to the lasting discredit of hon. Members opposite who supported that
policy, not because they believed in it but because a policy of protection
was the policy of the Tory Party. Many industrialists today feel that the
introduction of this Bill is rather ironical. They feel that a Bill for the
reorganization of the Government might be more appropriate. Indeed,
it is remarkable that the Government are introducing this Bill to organize
others in the midst of incredible chaos of their own making.

Numerous hon. Members on this side of the House have said that the
objects of this Bill are beyond dispute, and I support those views. The
Tory Party is as anxious as any other party to see ordered progress in in-
dustry and the maintenance of good standards, whether they be of prod-
ucts or of working conditions. Those are common objectives, I hope, of
all political parties in this country. But where we join issue is on the
means by which this aim is to be achieved, and we say that this Bill, as at
present presented to the House, is the most unlikely way of realizing that
objective. I think the House was surprised to hear the statement of the
President of the Board of Trade that he would use compulsion in putting
this Bill into operation. We take the view that if compulsion is used,
the objects of this Bill are entirely defeated. The smooth and efficient
working of this Bill cannot go hand in hand with compulsion; there has
to be a choice between destroying good will through compulsion and some
other means of organizing industry around these lines.
The President of the Board of Trade has said that we are to have con-
sultation. Now, "consultation" is a word which can mean anything or
nothing, and I am afraid that industry is coming to the view that it really
means nothing. It is no satisfaction to industry to be called to an office
in Whitehall and told that the Minister has decided to do this, that or
the other. That is not what industry regards as consultation. But it is the
kind of thing that is happening, and has happened in the past few months.
Therefore, we say the suggestion that there is to be consultation is in no
way satisfactory to industry. If there is not to be satisfactory consultation,
and if we are not to get the co-operation of industry, these development
councils will, of necessity, fail. There can be no question whatsoever but
that if the element of compulsion enters into it, the element of good, of

Industrial Organization Bill [W. S. SHEPHERD]

these councils being of service to the community, is driven out. Neither
industrialists nor bodies of trade unionists can be forced to co-operate in an
organization of this kind if they feel they are being forced along the line.
I am surprised that the Government are prepared to sacrifice the sub-
stance of good will for the shadow of compulsion. I am certain that that
view is entirely wrong, and will not produce the results which even the
Government wish to attain. It would be foolish and churlish to condemn
the element of compulsion without having some suggestions as to the
means by which the same results can be obtained. Hon. Members on this
side of the House have today indicated to the President of the Board of
Trade how these results could be obtained. They have pointed out, in a
manner which I think was perfectly clear, that the proper course in these
circumstances would be to develop the existing machinery. We have
already seen that a large number of people in industry-16 million-are
covered by joint industrial councils; and that an extension of that ma-
chinery is extremely desirable in order to implement these ideas. I am
surprised that the Minister has forsaken the possibility of developing these
organizations along these lines, but is prepared instead to come to this
House and to say, "I want compulsory powers to force people to do what
I wish them to do." Surely, there can be no question that the develop-
ment of the joint industrial councils, and other organizations, can lead to
the establishment of a pattern similar to the one which is aimed at in
this Bill? Surely, it is perfectly possible to get industry together, and to
get them to formulate their own plans, to make suggestions to the Minister,
and, if necessary, to incorporate the existing joint industrial councils or-
ganization in some more comprehensive plan? That could be done with-
out disturbing the existing organizations at all.
It is surprising that the Minister of Labor has seen fit to agree to the
proposals which are laid down in this Bill. Its proposals cut definitely
across the existing field of the Minister of Labor. As my right hon. Friend
the Member for Aldershot (Mr. Lyttelton) said, had the present Foreign
Secretary been Minister of Labor, this Bill, in its present form, would
not have seen the light of day. There is no question, I think, that the
field of the Minister of Labor is being cut across by the regulations which
are laid down here. The field of voluntary and statutory machinery covers
16 million of our workers, and that, surely, would have been the base on
which to work; that would have been the base on which the voluntary
principle could have succeeded.
We are opposed to this Measure because it is a very vicious example
of delegated legislation. If industries are important, there is every reason
why the Government should have thought fit to have brought a Bill to
this House in respect of each industry. Each industry could have been the
subject of a separate Bill. There is no reason why there should have been
this delegated legislation in this instance. The Bill requires that we take
out of their jobs men of exceptional ability. There is no doubt that that
is so. I suggest that we are doing a disservice to industry by taking those
men out. I do not feel that there is anything in this Bill which can com-
mend it to the House, and, therefore, we shall go into the Lobby against it.

'House of Commons, February 13, 1947

The Parliamentary Secretary to the Board of Trade (Mr. Belcher):
The hon. Member for Bucklow (Mr. W. Shepherd) referred to the fact
that there has been criticism of the Measure before the House from all
sides of the House. He went on to say that, apart from my hon. Friend
the Member for East Woolwich (Mr. G. Hicks), every Member who had
spoken had been critical. I suppose-I have not the experience in these
matters that many hon. Gentlemen have-that it is the purpose of a Second
Reading Debate on any Bill that there should be criticism made, some of
it-which is only to be expected-coming from the Opposition, some of it
coming from the Government side of the House, and designed to be help-
ful and constructive. That is the kind of criticism that we have had tonight.
I do not know whether the hon. Gentleman was referring to such criticism
as we had from this side of the House of the Government for not proposing
to give to the development councils more power than, in fact, we are
giving them. I suggest that it would be misrepresenting that kind of
criticism to pretend that it was criticism directed against the purpose of
this Bill.
There have been criticisms from the Opposition. That was to be ex-
pected-although I have noticed some significant absenteeism. The Op-
position criticism has varied from the speech of the right hon. Member
for Aldershot (Mr. Lyttelton), a speech which, I must confess, at times
left me puzzled as to what the right hon. Gentleman meant exactly, to the
reasoned and enlightened and constructively critical speech of the hon.
Member for Bath (Mr. Pitman), whose interventions in these Debates is
always most interesting and, to a very great extent, helpful.
The hon. Member for Bucklow, who wound up from the Opposition
side, to my mind made a very large part of the case for this Bill when he
referred to the decay which took place in so many of our great industries
in the years between the two wars. He said, excusing the industrialists, that
it was wrong and unfair of Government supporters to attempt to place
the blame on industrialists for what took place, because it was beyond
the power of any single industrialist to do anything about it. It is precisely
because we realize that in a great number of cases a single industrialist,
particularly a small industrialist, will be unable to do anything about it,
that we want development councils which will make it possible for him
to combine with others like himself to do this very necessary job.

The hon. Member attempted to tell the House just what are these
Whitehall consultations. As a matter of fact he gave a complete travesty
of them, as many hon. Members opposite know, because they have been
in my office for these consultations. I suggest that he is badly briefed on
that subject. I would invite him to consult some of the many trade asso-
ciations who come to the Board of Trade day by day to consult both the
officials and Ministers about aspects of their industries, and he will find
the picture he drew is a most unfair one.

Industrial Organization Bill [MR. BELCHER]

The hon. Member referred to the speech of my right hon. and learned
Friend, and said that he could not understand the references to possible
compulsion on industry to form development councils. He professed to
quote what my right hon. and learned Friend said. I will tell him what
my right hon. and learned Friend said, and I also endeavored to make it
clear in a subsequent intervention. He said:
"I cannot of course give any undertaking that in the last resort, in some special
hon. Members will note the qualification-
"it may not be necessary to impose a development council by order, but if that
should ever occur, which I hope it will not, then this House will have full cognizance
of the matter, because in all cases an affirmative Resolution will be required approv-
ing the Order."
That is very different from suggesting that compulsion is something which
is going to be lightly applied. It will not be lightly applied, because it
would be an extremely foolish thing from the Government point of view.
If any one of the parties composing the development council decided not
to play, what could you do about it? Suppose the employers said that they
would not co-operate. You would find it very difficult to get any kind
of council to work, and we realize that as well as anyone else, and that
is why my right hon. and learned Friend said that he hoped in every case
we should set up these development councils by agreement. That is the
obvious and sensible thing to do. The right hon. Gentleman the Member
for Aldershot referred to skating over things which go too far. That is,
no doubt, a sporting term, but it puzzles me. I do not know how you
can skate over things which go too far; presumably you come to the end
and fall over the precipice, but I think that the right hon. Gentleman
knows more about that than I do.
Together with other hon. Members who spoke subsequently, the right
hon. Gentleman accepted the objects to which the development councils
will be invited to turn their attention. He must do that, of course. As a
man who has experience in British industry, he knows perfectly well of
the need for a great deal of reorganization in all aspects of industry at the
present time. What he criticizes, of course, is the method by which we pro-
pose to achieve the object. May I point out to the House-and I am sure
this is very relevant-that in a report of the Federation of British Indus-
tries, issued in 1944, it was recommended that functions of this kind were
necessary, that this kind of thing ought to be done, and that if industry
was not prepared to do it itself, it would have to be done for industry.
Industry has not done it itself, and therefore, we are acting in accordance
with the report of the Federation of British Industries, and doing it for
Then we heard from the right hon. Gentleman, from the hon. Mem-
ber for Bucklow, and several other hon. Members, that, even granted
everything else, the method by which we were proposing to legislate was
wrong. I take it that the criticism is of our having this general enabling

House of Commons, February 13, 1947

Bill to give the power to set up development councils to a number of
Ministers by orders which would be subject to affirmative Resolution of
the House. But having heard my right hon. and learned Friend, I am
surprised that anybody should suggest that it would be possible for us,
in any one or more of the many industries which may at some subsequent
date require development council procedure, to proceed by way of a sep-
arate Bill for every one of them. I can only suggest that those who argue
for such a procedure are really arguing that these things should not happen
at all. It is not much good to an industry which at the present time is in
danger of decay to know that in, perhaps, ten years' time a Bill might go
through the House making it possible for it to have a development council.
On a point of detail, the right hon. Gentleman referred to Clause 8 (2)
as an overcoat provision, and criticized the powers that are conferred upon
the Board of Trade, or the Ministry concerned, as being open to abuse.
May I point out that it is expressly stated that an amending order, amend-
ing the original order setting up the development council, can, in the
terms of the Bill, be brought to this House only at the request of the
development council itself, and is then subject to affirmative Resolution
procedure, which gives the House a first-rate safeguard. In the first place,
it is only when the development council, consisting not of the Govern-
ment or of representatives of the Government, but of representatives of
the employers and the workers, plus an unspecified number of indepen-
dent members, probably fewer rather than more, has decided to ask for
some amended powers that the order comes before the House, and when
it comes before the House it is subject to affirmative Resolution. On the
other point of detail which the right hon. Gentleman made, concerning
Clause 1 (4), which reads:
"A development council may provide for any incidental or supplementary matters
for which it appears to the Board or Minister concerned to be necessary or expedi-
ent to provide."
I suggest that there the safeguards are to be found in the preceding and
succeeding Subsections. Subsection (3) says that:
"Before making a development council order the Board or Minister concerned shall
consult any organization appearing to them or him to be representative of sub-
stantial numbers of persons. .. ."
and Subsection (5) says that the order has to be approved by a Resolution
of each House of Parliament. We are tied down by the fact that an amend-
ing order cannot be made without an affirmative Resolution of both Houses
of Parliament.
With regard to the First Schedule, the right hon. Gentleman made great
play with the number of functions which are conferred upon the Board
or upon the Minister responsible under that Schedule. Nineteen different
functions may be assigned to a development council, but not necessarily
will be so assigned. The power is in the Bill, if it is deemed necessary to
make an order assigning these functions to a development council. The
right hon. Gentleman and subsequent speakers, referring to some of these
functions, said, "These are already being tackled, in some cases, by other
Government Departments, and, in other cases, by voluntary organizations."


Industrial Organization Bill [Ma. BELCHER)

There is nothing in the Bill to prevent these functions from being con-
tinued to be administered by other Government Departments or by volun-
tary organizations. It will be the purpose of a development council, where
practical, to use the existing agencies. It would be most improvident and
unpractical of them to do anything else. To suggest that we are getting,
as a result of this Schedule, an unnecessary duplication is to ascribe to
the development councils far less intelligence than, I am sure, they will
Then there is a phrase which I did not understand at all. The right
hon. Gentleman spoke about "Independent representatives on develop-
ment councils being subject to ministerial control." I think that it is very
wrong of him to suggest that the kind of people who will be invited by
the Minister to take seats on responsible bodies such as these councils are
intended to be the stooges of the Minister. That is quite untrue. Then
we come to the next rather puzzling point-
Mr. Lyttelton: It is beyond question that these bodies consist partly of
employers' representatives and partly of workers' representatives, with inde-
pendent members nominated by the Minister, and the Minister has power
to pay them remuneration and pensions. I did not say that they would
be the stooges of the Government, but they are enabled to turn them into
stooges whenever the Minister wishes.
Mr. Belcher: I prefer to believe that the people who will be appointed
by the Ministers to these boards will be independent. May I point out that
it is not the Minister who will have the power to pay the pensions or
salaries of the representatives on the board or council; it is the develop-
ment council themselves, so that if they are to be the stooges of anybody,
they will be the stooges of themselves.

May I get back to the very interesting figures which the right hon. Gen-
tleman spent some valuable minutes in giving us about voluntary and
compulsory wage negotiating machinery? I was puzzled, because there is
nothing in this Bill to give the slightest indication that there will be any
concern on the part of a development council-there cannot be in any case
-with wage and negotiating machinery. Why he felt it necessary to spend
so much valuable time in discussing something which is so hopelessly ir-
relevant, I do not understand.
Mr. Lyttelton: I cannot attempt to correct the hon. Gentleman's under-
standing-that would take too long. I am sorry that he did not take the
point that once we set up development councils over such a wide field as
this, they cannot perform the functions prescribed to them by the Gov-
ernment without entering the field of wages, hours and working condi-
tions-and he knows that very well.
Mr. Belcher: It will probably give the right hon. Gentleman some joy
when I confess to him that I am unable to follow his reasoning. I have a
certain amount of experience in industry from, perhaps, a different end

House of Commons, February 13, 1947

to that of the right hon. Gentleman, but I will quote him a single example.
He cannot really controvert that during the war we had very valuable in-
struments in our factories generally known as production committees,
which were expressly excluded from the discussions on wages, and I know
of no single case-and I was constantly in touch with them during the
war-where these production committees went outside their terms of ref-
erence in that respect. In any case as the right hon. Gentleman and I
know only too well both sides of industry, the employers' side and the
trade union side, who will be represented on the development councils,
are far too jealous of their existing negotiating machinery in regard to
wages and conditions to allow development councils to usurp their
The right hon. Gentleman asked for an undertaking that we will accept
an Amendment to the effect that councils will not be set up unless major-
ities in the industry agree to them. One hon. Member on this side of the
House interjected with the request to know how we were going to ascertain
what was a majority view in the industry. I, too, should like to know the
answer to that. How would the right hon. Gentleman ascertain whether
a majority of those in the industry, including both workers and employers,
are in agreement as to the necessity for a development council. I am
quite sure that the answer to that has already been made by the hon.
Gentleman for Bucklow-that it would be futile to try to impose these
organizations simply because an unwilling industry did not want them.
Mr. W. S. Shepherd: But the hon. Gentleman is going to do it.
Mr. Belcher: That has been clarified by the President of the Board of
Trade when he said that it will be only under the direst emergency that
that will be done.
Mr. Lyttelton: I do not want to be facetious about this. I understand
that the hon. Gentleman's argument is that we cannot ascertain whether
an industry is in favor of these proposals or not. Therefore, we may take
it that compulsion will always be applied because the views of the industry
cannot be ascertained.
Mr. Belcher: No. What I was saying was a statement of fact. It is per-
fectly easy to ascertain, if, in fact a majority is in favor of a development
council, but it is not so easy to prove that a majority is not in favor of a
council. [Laughter.] I will try to explain to hon. Members what I mean.
If we go to the representative organizations of the workers and they say
"Yes," and we then go to the representative organizations of the employers
and they say "Yes," then we can say that we have a majority in the in-
dustry-that is the organized people in the industry-in favor of the pro-
posals. If we go to the representatives of the employers and they say "No,"
and to the representatives of the workers and they say "Yes," who is in the
I want now to say a few words about the very reasoned arguments put
forward by my hon. Friend the Member for Elland (Mr. Cobb), who

Industrial Organization Bill [MR. BELCHER)
speaks with great authority on this subject and whose interventions will
always be welcome. While accepting the general purpose of the Bill, and,
in fact, most of the Clauses in it, he pleaded for a reform-and he asked
me to note the underlying word "reform"-of the trades associations, that
is, the trades associations plus the distributive's, consumer's and perhaps
the workers' interests, who would do this job as well perhaps as the devel-
opment councils. In the first place, I doubt very much whether any trade
association concerned would accept an addition to their ranks for any
purpose of distributive, consumer, and workers' interests. They are rather
jealous-and I suppose quite rightly so-of their peculiar functions. If
they were willing, however, I am quite sure that it is far better, despite
such difficulties as have been mentioned, when we are trying something
which is relatively new, to create for the purpose special machinery with
well defined functions, and let it get on with the job, co-operating by all
means with trade associations, trade unions and consumers' associations-
but do let us have these organizations for the job.
Then he stressed-and I entirely agree with him, as I am sure do all
hon. Members-the need for getting these ideas down to the small in-
dustries and the small manufacturers, and he said how difficult it was
to do it through any kind of organization. As I say, I agree entirely, and
I think it is precisely this type of organization that is more likely to get
down to the small manufacturer he has in mind than the existing organi-
zations which, for years, have had the opportunity to do so if they would.
My hon. Friend said that they did not, which is the strongest argument in
favor of the kind of organization which we are proposing to create.

My hon. Friend also brought forward an argument with which I must
confess I entirely disagree. He said that money will be expended on re-
search, that there will be a levy which will be applied to every section of
the industry, but that the benefits will go to the big men and ultimately
work to the detriment of the small man. My view is that at the present
time there are a number of fairly big people in industry able and pre-
pared to spend money on research. They are obtaining the benefit, and
it is because the small man cannot afford to do this and there is no organi-
zation to do it for him that he is denied the benefits which go to the big
people. I would hope that the development corporations, having made
it their business to levy all sections of the industry for the purpose, would
then see that the benefits of research are conveyed to everybody in the
industry who has taken part in securing them. I am reminded that in
the case of the textile industry there is an admirable example of research
which is available to all concerned, big and small.
I think that the hon. Gentleman was possibly right when he said that
there was greater need for an inquiry into efficiency in the distributive
side of an industry than in the productive side, and I think we would
all agree that there is a real need for inquiry in that direction. One of
the reasons why we propose to have a census of distribution is in order
to find out just what does go on, but as I said in an intervention earlier

House of Commons, February 13, 1947

this evening there is nothing whatever to prevent one of these development
councils inquiring into the distributive aspect of a particular industry.
It is not proposed to have a development council for distribution as such,
but there is no reason why a particular industry should not have the
distributive side of its activities inquired into by its development council.
Nor is there any reason why there should not be on the development
council people with special knowledge of the distributive side of the in-
dustry in order that they might help in this respect.
My hon. Friend the Member for Reading (Mr. Mikardo), who followed
soon afterwards, supplied the answer to the point about letting the trade
associations do the job by saying, in as many words, "Why did they not
do it before?" I am very glad to hear from the hon. Member for Bath
(Mr. Pitman)-who I am sorry has had to go, but who has indicated his
regret to me-that the trade associations are ready to co-operate. Their co-
operation will be very welcome, and I should like to say now that in much
of the work we are required to do in the Board of Trade, when the officials
of the trade associations come along and discuss with us quotas, prices,
and all kinds of puzzling things which have to be dealt with at the present
time, we find that their assistance and experience is invaluable.
There was a reference by my hon. Friend the Member for Reading
to the shortage of skilled management personnel. He rather feared that
the creation of development councils, as new bodies, might constitute a
further drain upon the scarce, highly skilled manpower. I agree that we
have not that large number of people in this country who can undertake
what might be called the high-powered jobs in British industry, but I
feel that the very setting up of development councils may make possible
a more economical use of our skilled managerial manpower. I hope that
that may be one of the things that development councils would be able
to look at.
My hon. Friend the Member for East Woolwich (Mr. Hicks) has been
criticized for making such a vigorous defense of the Bill and for referring,
in my opinion quite rightly, to the manpower situation in the country.
That is one of those aspects of our total economic situation which are
very worrying to those who are concerned about the future. One of the
reasons for the setting up of development councils is to make our indus-
tries as efficient as they can be, so that the greatest possible use can be
made of our available manpower. My hon. Friend was perfectly right to
talk about the general manpower situation. I hope that most hon. Mem-
bers will agree with the point he made about the discouragement in past
years of boys and girls from entering manual industry, and the encourage-
ment that has been given to them to go into unproductive employment.
I hope his words will be noted in many places.
He said that these development councils, if energetic and far-sighted,
could make a great contribution to the development of British industry.
I believe that to be profoundly true. It is not intended that the councils
shall attempt to run British industry. It is intended that they shall co-
ordinate, assist and activate the existing owners of British industry. It
has already been admitted today that they need it. It has been admitted

Industrial Organization Bill [MR. BELCHER)
by hon. Members that between the two wars many of our great industries
decayed. It was admitted in the report of the Federation of British In-
dustries in 1944. Today I referred to that report when the right hon. Men-
ber for Aldershot was out of the House. It said that action of this kind
was called for.
Sir Arnold Gridley (Conservative): Hon. Gentlemen opposite seem to
quote from the Federation of British Industries or from the Association
of Chambers of Commerce, no matter on what side of the House they sit,
and as it suits them. Do I understand the Parliamentary Secretary to say
that the Federation of British Industries approve the Bill?
Mr. Belcher: No, Sir.
Sir A. Gridley: In that case, I do not think the hon. Gentleman is quite
in order in saying that the F.B.I. were in favor of the Bill.
Mr. Belcher: I would not wish to say anything to offend the hon. Mem-
ber. What I did say was that I read a quotation to the effect that, in
1944, the Federation of British Industries reported that action similar
to that contemplated in the Bill was necessary, not necessarily by the
Government. Steps similar to these would have to be taken-co-ordination
\of research, and so on-and that if industry did not do it the Govern-
ment would have to do it for them. What I said was, that, since industry
had not done it, we were now setting about the problem. Before I leave
my hon. Friend the Member for East Woolwich, I would recall that he
mentioned taking workers into consultation on such matters as industrial
development. His observations commanded a fairly large measure of
agreement. Our wartime experience proved the necessity of so doing.

There is another section of the community which hitherto has had
less than proper regard in all these matters and in consultations which
have taken place, and that is the consuming section of the public as such.
By bringing into our boards, working parties and development councils,
representatives who are independent, that is to say who are there neither
necessarily as workers in that industry nor as employers but as independ-
ent people from outside the industry, we are bringing in representatives,
more truly than of any other section, of the consumers of the products of
that industry. That, I think, goes some way towards answering the point
made by the hon. Member for Eddisbury (Sir J. Barlow) who was very
critical of the position of the independent members of councils of this kind.

The hon. Member for Newark (Mr. Shephard) argued, if I under-
stood him correctly, that what we are proposing means a permanent con-
trol over industry. I do not accept that the powers conferred on develop-
ment councils under this Bill do in fact constitute a power over industry.
As one of my hon. Friends pointed out, the powers are very restricted.
They amount in fact to the power to collect statistics and publish the in-

House of Commons, February 13, 1947

formation in a general form, and the power to levy for the purpose of
promoting research. There is no power to go poking your nose into in-
dustry and telling individual industrialists how to run their businesses. You
can advise them, and if they are prepared to accept advice, well and good,
but you cannot make them do anything. Neither the development coun-
cils nor the Government can make them do anything they do not want
to do, and I wish it had been more clearly noticed throughout the Debate
that the powers conferred by this Bill upon the development councils
are very small indeed.
Mr. S. Shephard: What is to prevent a development council coming
along in the future and asking for these powers?
Mr. Belcher: The answer, of course, is that in the first place the Gov-
ernment may refuse to do anything about it, and in the second place, if
the Government are inclined to do something about it, there must still
be an affirmative resolution of both houses of Parliament. Surely, the safe-
guard is there, because even without this Bill somebody might come along
in the future, ask for something and get it, and I do not see that passing
this Bill will make the slightest difference in that direction. Then the
hon. Member asked me two specific questions to which I will try to give
adequate replies. He asked me how the Ministers will appoint employers'
representatives. The practice will be that which is normally followed by
Ministers in appointing representatives of employers. He will invite the
appropriate association of employers to make nominations. He may not
necessarily accept all the nominations sent in by the employers' associa-
tions, but in practice I imagine that it would be those who were recom-
mended by the associations who would be taken. So far as the payment of
members is concerned, it is envisaged that expenses will be paid to the
members of development councils, and that the chairman may have to be
paid. Perhaps his job will be such that it will have to be completely full-
time, in which case of course he will have to be paid.
Mr. S. Shephard rose-
Mr. Belcher: I ask the hon. Member not to interrupt, as my time is short.
The answer to the hon. Member for Huddersfield (Mr. Mallalieu) who
spoke about avoiding duplication in the collection of statistics, is to be
found in the proviso to Subsection (2) of Clause 3, where it is pointed
out that:
"Provided that powers conferred on the council under this Subsection shall be
qualified, in relation to exercise thereof generally as regards the industry or any
section thereof, by provision requiring the previous consent of the Board or Minister
concerned to their being so exercised and approval by the Board or Minister con-
cerned of the form in which the returns or other information will be required to
be furnished."
The Minister can thus prevent a council from demanding statistics if the
Government are already collecting the same information. That I think
is a sensible provision which gets rid of the danger of duplication of that

Industrial Organization Bill [Ma. BELCHER]

One hon. Member asked about the relation between the development
councils and the Department of Scientific and Industrial Research and the
Council of Industrial Design. As I have said previously in connection with
other voluntary organizations, development councils will work through,
and will not supersede, research associations and design centers. Contribu-
tions from the councils' research levies to these bodies will count as in-
dustrial contributions, and will attract the appropriate Government grants
from the Department of Scientific and Industrial Research in regard to
research and from the Board of Trade in regard to design.
Finally, the hon. Member for Central Aberdeen and Kincardine (Mr.
Spence) asked whether the Defense (Services for Industry) Regulations,
which we debated some months ago, and which give power to raise levies
for research, would be superseded by the present Bill. The answer is
that they will. When those Regulations were debated, it was made clear
that the intention was to replace them ultimately by permanent legislation,
and this is the permanent legislation.
I conclude by saying that, in bringing forward this Measure, we do so
because we know, as is generally known, that the state of British industry
is not what it needs to be if British industry is to produce the goods and
services to enable us to make up the leeway in our export trade and enable
us to give our people the standard of living and the security which we
want them to have. A great deal needs to be done by everybody concerned;
that has to be recognized by everybody concerned, and I make no reserva-
tions in that respect; but the drive must come, in the first instance, and
is coming, from the Government. The Government cannot do the physical
work, but the Government can make such plans and provide such legisla-
tion as will enable other people to go ahead with their jobs. [An HON.
MEMBER: "What about the coal situation?"] It is most unfair of hon.
Members to refer to a situation which has come about through a combi-
nation of climatic conditions and many years of failure to do anything for
the coal industry. [Interruption.] It is very wrong of hon. Members who,
I am quite sure, are as much concerned about the future prosperity of this
country as we are, to criticize a Measure designed to assist this country
back to prosperity, on grounds as unfair as those indicated by the jibe of
an hon. Member who spoke about the coal situation. I know it is the in-
tention of the Opposition to divide. I hope they will divide knowing that
they are voting against something which is genuinely inspired by a desire
to assist this country back to prosperity.
[House of Commons Debates]

London, February 10, 1947

Broadcast by the RT. HON. CLEMENT ATTLEE, Prime Minister

London, February 10, 1947. I am speaking to you tonight in order to
put before you quite simply the facts of the critical position of our fuel
supplies and to ask every one of you to do your best to help to overcome
the difficulties that face us. I am sure that you will all do your bit as you
did in the war in other emergencies.
Let me tell you the facts. In order to get through the winter months
we need to have coal in stock. Ever since 1943 we have had to face a winter
with smaller stocks than we require. We got through in the war because
the wartime closing of non-essential industries, the blackout, and double
summer time reduced the demand. But we have never been able to stock up.
We found ourselves at the end of last winter with less than seven million
tons in stock, and we only managed to increase this during the summer
and autumn to eleven million tons, three million tons less than last year,
although during the last few months the miners with fewer men have
produced more coal. Why was this? Because the demand has risen so
rapidly owing to the starting up of peacetime production and the return
to more normal conditions of life. In particular, the consumption of
electricity has increased far more rapidly than had been expected by re-
sponsible authorities, with the result that stocks of coal at the generating
stations were at a low level at the beginning of the winter. To meet this
situation appeals were made to the public to economize in the use of
electricity; electric light and power was cut off at certain hours, and a
careful system of allocation of coal to industry was instituted.
So long as coal could be produced and moved we should have been
able to get through the winter unless we had exceptionally bad weather.
But you all know what the weather has been the last few weeks. Gales and
fog have delayed the sailing of ships from the North-East Coast and South
Wales; ice and snow have disorganized railway traffic. Nearly forty thou-
sand loaded wagons are immovable in the colliery sidings in the Northeast-
ern area alone. Railway lines are blocked in many places, and points frozen.
Tunnels have been made impassable by drifts. At docks and staithes loading
equipment has been frozen up and loading has been difficult even when it
has been possible to get the trains and the ships moving. Production of
coal at the pits has been slowed down. A number of collieries cannot
work at all.
We do not know how long these conditions will last. Our miners, sea-
men, dockers, railwaymen and other transport workers have responded
magnificently to the public need. They have worked, many of them, day
and night without sleep to move the coal. Everything possible is being
done to keep the coal moving. It is being given absolute priority over all
other traffic. But it is inevitable that even after a general thaw sets in it
will take time to get everything moving smoothly again. Much precious
coal production has been lost. As a result we face an emergency of the
utmost gravity.

The Fuel Crisis [Mn. ATTLEE

The situation is most critical in London, the South-East, the Midlands,
and the North-West. Everything possible is being done to get coal to the
power stations in these areas. But the supplies are only enough for essen-
tial services, and to enable the ordinary householders to cook their meals
and light their homes. Electrical power is therefore being prohibited for all
but the most essential industries in these areas, and for maintenance work
which cannot be stopped without danger. People are being asked not to
use electricity between the hours of 9 and 12 in the morning and 2 and 4
in the afternoon, and to economize as much as possible all the time.
These restrictions are bound to impose hardships and severe temporary
unemployment. They cannot be avoided. The power stations must be
kept going in order to maintain food supplies, water, sewage, and commu-
nications. These are vital to the health of the community. This can only
be done if everyone will help. Detailed instructions have already gone out
to all the 340 Electricity Undertakings in the most affected areas. Notices
in the press and on the B.B.C. have already told you what we want the or-
dinary household to do. I do not want to go into technicalities, but we
cannot as a rule cut off householders without at the same time depriving
essential services of current. Because of this you may well find that your
electricity supply is still on even in the restricted hours. We rely upon
you not to use it during these times, and to use it with the utmost possible
economy at all times. But remember that gas must be used, too, as spar-
ingly as possible.
It is just because the reduction we need can only be effected by the
voluntary act of every one of you that I am asking all of you to co-operate
together in seeing that no electric lighting or power is wasted. Use no
more in your homes tlan the absolute minimum you must for essential
purposes of lighting and cooking while this crisis lasts.
The response so far to the Government's instructions to industries and
businesses of all kinds has been most encouraging. Employers and work-
ers alike are doing everything they can to carry out these instructions.
We can, I know, depend upon everyone to do likewise.
Finally, let me say this. Many of you while this emergency exists will
not be able to carry on with your ordinary work. Factories will be closed
down. Some of you cannot now work as usual because of the fuel cuts.
But you can help by reporting to local Employment Exchanges for work
on clearing essential communications. We must keep communications
Well, that is the situation. I have given you the facts as simply and
clearly as I can. I have told you what we are doing to overcome this criti-
cal emergency in which we have to fight against frost and snow and storms
in order to keep going the services essential to our national life. We have
come through greater emergencies and much more critical times. We will
come through this if we pull together, each doing everything possible to
help. I am confident that you will all help and will do what you can.
[Oficial Release]

House of Commons, February 11, 1947

HOUSE OF COMMONS, February 11, 1947

Mr. Skeffington-Lodge (Conservative): I am very glad that the Minister
of Labor himself has come along to reply to this Debate, and I wish more
time had been available to deal with the subject on which I wish to speak
tonight. In the course of his recent statement to the House, my right hon.
Friend stated that, so far, only about 2,000 of the 142,000 Poles still in
this country have been placed in civilian employment. It was because I
and many other hon. Members on this side of the House considered that,
in present circumstances, this is extremely unsatisfactory, that I gave notice
I would raise the matter again. There is, of course, no short cut to the
rapid absorption of any large number of foreigners, whatever their na-
tionality, into our national life. I do feel, however, that much more might
already have been done to speed up the elaborate machinery which has
been set up for this purpose in relation to the Poles, for whom we have,
in some quarters willingly and in some quarters reluctantly, accepted a
Let me briefly give the House the background facts as they are known
to me. The Poles in our midst-of whom roughly two-thirds were Allies,
in the full sense, all through the war-at present have three courses of
action open to them. Firstly, they can, as one recently put it to me, "take
a chance" and return to Poland; secondly, they can volunteer for and join
the Resettlement Corps; or, thirdly, they can play a game of "wait and
see," which is linked in some cases with a looked and longed for chance
to emigrate. Some 20,000 of these Poles have already opted to return to
Poland; and more among the doubters, I feel, might do so if more im-
partial news of those who have gone back to Poland were readily available.
Encouragement from Warsaw would, I think, help here. In the second
category I have mentioned there are about 58,000 men. The remainder
of the Poles in this country have still to make up their minds about their
future. There is evidence that among the officer class in particular there
is a vested interest in maintaining the status quo, which I think is a not
unnatural thing. But this I suggest should be very carefully watched, if
only because the high proportion of men in commissioned rank enables
them to exert a more than usual influence on their comrades. I have
reason to think that in some cases the prospect of becoming mere alien
civilians themselves, if they lose their flunkies, has at least led to dis-
couraging enrollment in the Resettlement Corps, and to the preference
of so many Poles for what can only be called a "no man's land" status.
There is also some influence, which I believe actually to be quite small,
which seeks to discourage men from going back to Poland.
All this, of course, is more a matter for the Secretary of State for War
than for my right hon. Friend. But it has relevance to this Debate, I
think, because it is important that my right hon. Friend should know at
the very earliest moment just how many men out of the grand total are
actually available to him as a permanent labor force in this country. The

Employment of Poles in Britain [(M. SKEFFINGTON-LODGE]

sooner the doubters and those who are hesitant make up their minds, or
can be persuaded to make up their minds, the easier will be the Minis-
ter's task. Far from discouraging it, the controlled influx of foreigners
into our labor market should be very much pressed on with as one of the
best and possibly the only means open to us of surmounting our present
economic difficulties. And in the Poles already here lies a ready to hand
labor force which should, as soon as possible, be supplemented by dis-
placed persons in Europe, the bulk of whom, of course, are the fellow
countrymen of the Poles among us.
I hope that my right hon. Friend will be able tonight to give me an
assurance that he will use all his influence to see that the screening and
sorting, making-up-their-minds process, as applied to all Poles in this
country, are greatly speeded up. It was on 22nd May, 1946, that the For-
eign Secretary announced the formation of the Resettlement Corps. Yet,
to give just one example of inactivity, it is only in recent weeks that any
attempted enrollment to that Corps has been begun of the 8,000 members
of the Polish Forces in the North-West Region of the Ministry of Labor.
An accurate classification of those opting for the Resettlement Corps is the
next urgent step, and this, I am told, has been hanging fire in various
parts of the country. Other problems thenceforward facing the Minister
lie in such directions as finding jobs for the volunteers, fixing them up
with accommodation, and so on.
The undesirability of using these Poles as gang labor should be obvi-
ous to everyone in the House; and this, of course, means that they must
be absorbed individually. It is not, I feel, detracting in any way from
their courageous bearing, and their bravery in the war, to say that they
are not the easiest people to acclimatize to our British way of life. The
mental atmosphere of medieval romanticism in which they often appear
to dwell, makes them psychologically difficult. We must, however-and
this is perfectly clear-honor the responsibility that we have assumed; and
it is, of course, quite true that they are good and very hard workers. An
hon. Member on this side of the House talked to me this afternoon about
the magnificent work which the Polish Forces have done in Lancashire
during the past week in clearing snow from the Lancashire to Yorkshire
main line railway. He said, "I do hope you will mention this as evidence
of the fact that they are prepared, when given the chance, to get down
to a job."
The Minister must, I feel, go all out in getting these men into jobs,
for the manpower gap, in coal mining especially, in spinning and in
foundry work is becoming enormous. It will soon-and very soon-exist
in agriculture, and in such things as brickmaking, both of which are so
notably represented, incidentally, in my own constituency. I ask the Min-
ister tonight to use all his influence with the Trade Unions, so as to en-
sure that the new realism of the more far-sighted leaders about this foreign
labor question permeates to every branch of the rank and file, and removes
what is, in our present plight, an absurdly conservative approach to some
of these labor questions. It is right, of course, to insist that no foreign
workers shall become a cheap labor force, impeding improvements for

House of Commons, February 11, 1947

our own people, or threatening unemployment; and there must, again,
be safeguards against the Poles, or anyone else, forming any enclave or
cell in our national life.
But it would do good and not harm if that anti-foreigner complex and
the nationalistic and illiberal outlook, which still seems to haunt the Home
Office in their attitude to would-be immigrants, were once and for all cut
out. Manpower, in the lower age groups of our own people, is bound to
shrink for some years ahead, and because of that, we can do with all the
physical help we can lay our hands on. In addition to those already here,
it is pertinent to point out that there are some 380,000 Poles, many with
first-class industrial and agricultural experience, waiting to be used who
are now sitting in idleness in the British and American Zones of Germany.
This huge labor pool should be tapped, and should be tapped quickly,
before other countries like Belgium, which are already awake to this situ-
ation, steal a march on us. The Poles already over here should be re-
moved at the earliest moment from a military atmosphere. This, I recog-
nize, depends very largely on the speed with which my right hon. Friend
presses on with their absorption into civilian life. It is obvious that in
the interests of morals, efficiency and discipline the present arrangement
cannot be changed over night, but it would help our relations with the
Warsaw Government-and I am one who wants to see those relations very
much improved-if the difficulties accounting for the present situation
were more carefully explained than they have been.
Finally, I want to ask the Minister to give me an undertaking tonight
to make a regular progress report to this House. I even hope that he may
be able to offer some encouragement about the actual placing here and
now, in view of the miserable figures which he gave us on 28th January
as far as those who are actually engaged in civilian occupations in this
country are concerned. I recognize that the difficulties in connection with
this problem are very considerable, but they are there to be faced, and
they are there to be overcome, and they will only be overcome by the de-
velopment of a long overdue spirit of drive and urgency in tackling them.
We cannot possibly afford any longer to keep a costly contingent of Poles
in our midst, either in voluntary or in enforced idleness, and the sooner
the Government push on with their absorption into useful activities, the
better it will be for all concerned.
The Minister of Labor (Mr. George Isaacs): I welcome the opportunity
of giving some further information upon the question which has been
raised by my hon. Friend, the Member for Bedford (Mr. Skeffington-
Lodge). May I first, express my appreciation of the spirit in which he has
brought the matter forward and given the facts? I hope to be able to give
him most of the information for which he has asked, and I hope I may be
able to give the assurance and the undertaking he desires. He, quite
rightly, said that there is no short cut to the employment of Poles. We
found that in endeavoring to tackle this problem. I repeat what I said
the other day, that the principle of accepting them and placing them is
fully accepted, but it is a question of machinery and ways and means.
There is a widespread impression that because there is a labor shortage

Employment of Poles in Britain [MR. G. IsAAcs]

and because there are 140,000 Poles available, it is simply a question of
putting them into jobs which are vacant. I do not want to use the analogy
of square pegs in round holes, because someone might ask if the pegs were
Poles. First, we have to make sure that we are putting willing men into
suitable jobs. It is no use just getting hold of a bunch of these fellows
and shovelling them into jobs. They are human beings, men of a fine
type. I took the opportunity, a few days ago, to go into one of the camps
to see the screening at work, and the selection of these men for employ-
ment. I saw clean, healthy, decent, men who have been through the fire
of war side by side with our men, or, if not that, have been in our Armies.
Once they got into our workshops with our British workers I am sure that
the first antipathy of our working men to them would melt away once they
realized that these Poles are, after all, human beings. Once we get the
scheme started these men will, I am sure, be welcomed and received
wholeheartedly. But we are anxious not to rush on, and upset things by
being too hasty. Our aim has been to find the suitable job for the suitable
man, to ensure that he will be able to carry on without opposition. If we
make a mess of things in the beginning we shall create problems which
will make absorption more difficult. The movement up to now has, I
admit, been slow, slower than we would have hoped. We badly want to
get these men at work. Not only that, but we want them to be earning
their keep, instead of being kept at the expense of the State. It is a piece
of two-way traffic that will help in both directions.
We are trying to place the maximum number of these men into work
as civilians, and the minimum number into uniform, to work in gangs.
We want them to get out of uniform, out of the military atmosphere. We
do not want them to settle down in any kind of employment where they
are engaged under any kind of semi-military control. We want them to
be under the orders and directions of foremen and overseers, and not
sergeants, sergeant-majors, or commissioned officers. We must remember
that these men are being treated, in this scheme, as free agents. We want
them to be placed as volunteers, because we all remember the old saying
about a free man being better than a pressed man. We want them to
come in willingly. The fact that they have been enrolled in a corps
means that they are willing to come in as free men. This makes the
placing of these men a little different from placing prisoners of war. If
we wanted to send a gang of prisoners of war to clear a road, or anything
of that kind, we could order them to do the job. But we do not want to
treat the Poles like that. We'want them to come in as volunteers.
Another big problem is the fact that a high proportion of these Poles
do not speak English. For most of our occupations, a knowledge of our
language is essential. Instructions have to be given to these men, and if
we want to use them on the skilled work which many are capable of per-
forming it is essential that they should understand the instructions, and
be able to read the directions, which are given to them. It will be easier
to hesitate a little, and teach the Poles English than to try to teach their
instructors the Polish language. If we added that to the burden of our
instructors and overseers we should find ourselves in great difficulties.

House of Commons, February 11, 1947

The next point upon which my hon. Friend touched was the necessity
of obtaining co-operation. It has been a matter of obtaining co-operation
not only with the trade unions but also with the employers. In addition
to the agreement of the trade union to the employment of the Pole and
of the British workman to work with him, we have had to get the em-
ployers to agree to have him. In the beginning we attempted to achieve
this co-operation by means of the various Departments of the Government
handling their own particular sections. The Ministry of Fuel dealt with
the coal mines, the Ministry of Supply with their industries, the Ministry
of Agriculture with theirs, and so on. Very soon, however, we came up
against the peculiar difficulty that each of the industries concerned gained
the impression that they would be required to take all the Poles, or very
nearly all, and each of them said, "Before we make up our minds, let us see
what the other fellows are going to do." At that point it was decided to
place the matter in the hands of the Ministry of Labor, and we proceeded
by meeting the Joint Councils of the industries. Here I should like to in-
form the House that at the outset the National Joint Advisory Council,
which consists of representatives of the British Trades Unions Congress, and
the Federation of Employers Organization, very readily and willingly agreed
to the principle of the employment of Poles. Thus, right at the top, we
had encouragement to continue our efforts. Then we had to get down
to the industries.
We have done so, and we have found a very ready acceptance of our
proposals and a desire to help. I can therefore assure my hon. Friend
that the influence he has asked me to use with the trades unions has already
been exercised. I have had many years' experience in the trade union
movement and I am happy to say that we are receiving very cordial co-
operation from that quarter. If hon. Members will read an article pub-
lished in the current issue of a T.U.C. organ called Labour they will find
there a very clear indication of the desire that this work should be con-
tinued. The industries with which we have had successful negotiations
so far are agriculture, coal mining, building and civil engineering, gas,
retail bespoke tailoring and parts of the iron and steel industry. They
have all agreed to take men. The next thing is to arrange when and
where they shall take them, and other details.

Some of the Poles who have registered for those industries have said
that they have skill in a particular occupation, but here we have found
ourselves up against the question of what really was their trade. In the
center which I inspected I found that a great number of these men were
registering themselves as "locksmiths." It began to be somewhat surpris-
ing to find that there were so many locksmiths until we discovered that the
term "locksmith" was synonymous to the Poles with the term "engineer-
ing" in this country, and that when a man spoke of himself as a "lock-
smith" he really meant what we mean by "engineer." That was one of the
problems, and although we overcame it, it shows that if we are to ask

Employment of Poles in Britain [MR. G. ISAACS]

a firm to take a man who describes himself as a certain type of craftsman
we must be satisfied that he is in fact what he says. We should probably
kill this scheme if, when an employer asked for half a dozen engineers, the
men we sent to him turned out to be nothing of the kind. He would be
likely to send them back and to say, "If that is the kind of men you are
going to send me I do not want any more." That is another reason for
going steadily in this matter. If men were sent back in such a case we
should have to return them to the Resettlement Corps, and as soon as we
did that they would dishearten other men who had not yet come out.
Viscount Hinchingbrooke (Conservative): Surely the Minister is not
suggesting that as a formidable difficulty. Is it not simply a question of
reference to a dictionary to discover exactly what the men are?
Mr. Isaacs: No. It has to be understood that these people are speaking
their own language, which has to be interpreted to our officer who is
registering their particular kind of work. When we became used to the
synonymous terms to which I have already referred, and we asked one
man who said he was a locksmith if he did not really mean "engineer,"
he pointed to a lock and made it perfectly clear that he meant what he
said. In that particular case the man was in fact a locksmith. I merely
mention this to show that you cannot just get these men from the Reset-
tlement Corps, put them in a wheelbarrow and take them off to a job.
We have to know what we are doing. In coal mining, training is essen-
tial; there must be training before the men are put into jobs. Then
there is the other problem, that they must have some knowledge of Eng-
lish before they can assimilate training; that is another problem that
crops up.
But I want to make it clear that the major obstacle is accommodation.
As time is short, perhaps the House will permit me to make a brief state-
ment rather than amplify it. Housing is very short in all areas; the
alternative accommodation is in camps, but that is not so easy as it
sounds. The Army and the Air Force are quite willing to give us camps,
but many of our camps are built in very remote parts of the country for
safety reasons, away from the centers of industry, and when we get the
camps many of them are so far away that it is very difficult to get the
men to the jobs.
Mr. Osbert Peake (Conservative): Are there not, all over the coun-
try and especially in the coalfields, the hostels built by the right hon.
Gentleman's Ministry during the war for the accommodation of trainees
for the coal and other industries?
Mr. Isaacs: Yes, but perhaps the right hon. Gentleman will not mind
my saying that at that moment I had departed from coal; I do not think
there is as great a problem so far as coal is concerned as there is for the
vast number of other industries. If the House will permit me, I will
show where we are getting to in this. The camps raise other difficulties
as well, for when we have the camps we have to have somebody to run

House of Commons, February 11, 1947

them; what we are hoping to do is to put in them the Poles who have
wives with them, and so arrange things that the wives will be able to
take over the running of the camps so that we shall not have to draw on
other British labor for this purpose. These administrative difficulties are
being overcome.
Now as to progress. The number of enrollments in the Resettle-
ment Corps is now 62,000, and it is hoped that enrollment will be com-
pleted in the first quarter of this year. They have to be screened to find
out whether in fact they are Fascists or not; they have to be enrolled in
the Corps and then we step in and register them for employment. Skilled
employment officers see them and find out their capacities and then go
about finding places for them. I can report an improvement; it is not a
very big figure in itself but it is an improvement; placings have now
reached 3,200-that is 1,200 up on last week, but of course it is only a
small number. We are however confident of accelerating that rate of
placings. We have already planned, and have arrangements to place
many hundreds-I would not like to give an exact figure-in the imme-
diate future in the brick-making industry, in building materials, forestry,
and road schemes. Other vacancies are already earmarked, as soon as
we can get the right types, in tin mining, cotton, iron-stone mining,
building and civil engineering, various sections of the iron and steel in-
dustry, and agriculture. These vacancies are immediate and will be
filled as soon as the fuel difficulties have been overcome. Many of these
industries are fuel-using industries and as soon as we can get that moving
these men will be available and will be placed.
Arrangements for the first batch to go into training for the coal-
mining industry are now going forward. It is hoped that we can arrange
for an intake of 300 a week for the coal-mining industry. Time does
not permit me to go much further but I said I would give an under-
taking to the House. I have given an undertaking that the screening
machinery will be proceeded with rapidly, and I can give the undertak-
ing asked for that I will make a periodical report. At the moment I think
it could be a monthly report, and I think I can make it as from the end
of the current month. I will keep the House fully informed of exactly
what steps are being taken, the progress that is being made, and any
difficulties that have arisen. I hope in that very brief sketch I have
been able to draw attention to the human problem that exists here, and
to assure the House that it is the Government's intention to make use of
the greatest number of these men that can possibly be used.
[House of Commons Debates]

The Palestine Situation [MR. CREECH JONES)

HOUSE OF COMMONS, February 6, 1947 [Extracts]
The Secretary of State for the Colonies (Mr. Creech Jones): Not-
withstanding the release by the terrorists of Judge Windham and Major
Collins on 28th and 29th January respectively, there has been increasing
tension throughout Palestine, although I am glad to say that there has
so far been no report of any fresh terrorist outrages. There has been no
further development as regards the case of Dov Groner, though I take
this opportunity to deny most emphatically that the Palestine Govern-
ment have been in any way connected with pressure being put on him to
appeal. There have been threats of renewed activities by terrorist or-
ganizations such as the taking of further hostages if the death sentence
is carried out.
Meanwhile, the Palestine authorities, as the House will be aware, have
been endeavoring to secure the co-operation of the Jewish community
in Palestine in measures necessary to prevent terrorism. The Jewish
community refuse to assist in this preventive requirement and to co-
operate with the Administration by giving information. The Chief Secre-
tary to the Government of Palestine on 3rd February, addressed to Mrs.
Meyerson and to Mr. David Remez, chairman of the Vaad Leumi, a letter
which has been described as an ultimatum, but which is really no more
than a request for an answer to a specific question. The letter refers to
the refusal of the Agency and the Jewish community to co-operate with
the authorities, invites their attention to the extreme gravity of the situ-
ation created by these refusals, and asks the Agency and the Vaad Leumi
to state categorically at once whether they are "prepared within seven
days publicly to call upon the Jewish community to lend their aid to the
Government by co-operating with the police and the armed forces in
locating and bringing to justice the members of the terrorist groups."
So far as I am aware, no formal reply has yet been made to this letter,
though the prospects of co-operation in this respect are not encouraging.
I should add that the demand made by the Chief Secretary to the Jewish
community to lend their aid to the Government by co-operating with the
forces of order in locating terrorists and bringing them to justice is no
more than a demand to give that minimum co-operation to the authori-
ties which all communities offer as a matter of course, in order that the
framework of society may be maintained. The Jewish community is
merely urged to help prevent the perpetuation of practices universally
regarded as criminal and of which their spokesmen have repeatedly ex-
pressed their abhorrence.
I turn now to other developments. The authorities have no desire to
impose military repression on Palestine, but the terrorist organizations
have themselves stated that there will be further outrages and that they
will "turn Palestine into a blood bath" if the sentence against Groner is
carried out. In the light of past experience and in these circumstances,
the Administration has been obliged to take all necessary precautions for


House of Commons, February 6, 1947

the safety of the British community in Palestine, while as far as possible
avoiding any action which might cause the situation still further to de-
teriorate. As has already been announced in another place, the authori-
ties have decided to evacuate British women and children and certain
other British civilians, in order that the Government and the armed forces
may not be hampered in their task of maintaining order. Civil adminis-
tration will be maintained as far as possible on normal lines, and such
limitations as are placed on the movements and activities of civilians will
be the minimum which circumstances demand. The evacuation is in
progress and the first parties have already arrived in the United King-
dom ....
No Government officer is being evacuated, except some women teach-
ers. Members of religious orders, missionaries, doctors and nurses are re-
maining and carrying on as far as possible with their normal work. There
have been some protests from the commercial community, but cases of
commercial personnel are being individually considered by the authori-
ties and agreement reached with the heads of the business houses con-
The arrangements being made for the concentration of necessary civil-
ian personnel within specially defined cantonments in various areas in
Palestine must also cause great disturbance and hardship to those mem-
bers of the Arab and Jewish communities who have seen their homes
and properties requisitioned. I can only express my regret that it should
have been necessary to take these measures. The steps so far taken are
necessary if effective military action has later to be carried out. . .Our
sole endeavor is to maintain peace and good order in Palestine. . .
Mr. Sydney Silverman (Labor): Is it true that the Jewish community
in Palestine has offered to root out terror by the use of its own institu-
tions which, so far, it is not entitled to use; and does the administration
in Palestine now propose to avail itself of that offer, which goes far beyond
the request made by the Administration?
Mr. Creech Jones: The Jewish community now have the opportunity
of declaring to the Government what steps they are prepared to take to
deal with terrorism. . .
Mr. B. Janner (Labor): Is the right hon. Gentleman not aware of the
fact that the Jewish Agency is the body designated to assist the Manda-
tory Power in facilitating the immigration of Jewish people into Palestine;
and is he aware that there is no power vested either in the Jewish Agency
or the Jewish community-other than that of informing-which can be
exercised at the present time. In these circumstances, will he vest some
real power in the Jewish Agency in Palestine so that they may be of as-
sistance in this matter?
Mr. Creech Jones: I am not concerned at the moment to invest new
powers in the Jewish Agency. What we are doing is to ask if the Jewish
community will co-operate with us in stopping criminal practices.
Mr. Robert Boothby (Conservative): Can the right hon. Gentleman say

Question Time in the House of Commons

when he expects the Government will be able to agree upon a construc-
tive policy of any kind?
Mr. William Gallacher (Communist): I want to ask the Minister if
it is really considered feasible to ask any people to turn against their own
kin, when they have no responsibility whatever for the situation which
exists and the trouble that has taken place? [House of Commons Debates]


The first hour of every sitting day in the House of Commons is
devoted to answering questions which Members of Parliament put
to Ministers. A selection of some of the questions asked during Feb-
ruary, 1947, is included below, together with theMinisters' answers.

Mr. Gallacher (Communist) asked the President of the Board of Trade
how many building projects for new factories and extensions to existing
buildings were approved in the year 1946; how many workers will be em-
ployed as a result of these developments; and of this total, how many were
in the development areas, and how many were in Scotland.
The President of the Board of Trade (Sir S. Cripps): Two thousand and
sixty-six new factories and extensions to existing factories were approved
in Great Britain during 1946. These building projects, when completed
and in full production, should provide employment for approximately
246,000 workers. Of the total number of projects, 774, with an employment
value amounting to approximately 141,000 workers, were in the develop-
ment areas and 342, with an employment value of approximately 49,600,
in Scotland. [February 3, 1947]
Wing-Commander Robinson (Conservative) asked the Secretary of
State for Foreign Affairs with which countries he is negotiating for the
mutual abolition of visas; and in which cases have negotiations been suc-
cessfully concluded.
The Minister of State (Mr. Hector McNeil): We are at present nego-
tiating on this subject with the Governments of Norway, the Netherlands,
Denmark and Luxembourg. As the House is aware, agreement on this
subject was reached with the Government of France. I am also happy to
announce that a similar agreement has been concluded with the Govern-
ment of Belgium, upon which a communique will be published within the
next few days. [February 10, 1947]

Question Time in the House of Commons

Mr. Keenan (Labor) asked the Minister of Labor if it is intended to
modify the terms of the Control of Engagement Orders, in view of the
changes in the age of call-up of men to His Majesty's Forces which have
been in operation since the beginning of this year.
The Minister of Labor (Mr. Isaacs): Yes, Sir. I have made an order,
with effect from 24th February, abolishing all control of engagement except
in relation to agriculture, coal-mining and building and civil engineering,
in which industries the existing control of engagement continues unchanged.
[February 20, 1947]

Captain John Crowder (Conservative) asked the President of the Board
of Trade what are the cotton allocations for export for the first period
of 1947.
The President of the Board of Trade (Sir S. Cripps): The total quan-
tity of cotton yarn allocated for the production of export goods in the
first period of 1947 is 15,000 tons, a reduction of about 40 per cent on the
allocation for the previous period. Owing to the heavy load of orders
already in the industry, which has been intensified by the present dis-
turbances of production, the issue of this allocation must be delayed for
the time being. As has already been announced, the system under which
the export allocation is administered is being altered to take account of
the general production position in the cotton industry and of the country's
need for exports to hard currency markets. Details of the new system will,
I hope, be announced shortly.
Captain Crowder: Can the Minister say whether manufacturers and re-
tailers have previously had all this information? Do they know the position?
Sir S. Cripps: I think they do, but I cannot answer that Question with-
out notice.
Mr. Sutcliffe (Conservative): Is the President of the Board of Trade
aware that this is one of the very serious aspects of production, both for
home and export trade?
Sir S. Cripps indicated assent. [February 27, 1947]

Brigadier Mackeson (Conservative) asked the President of the Board of
Trade if he will give a comparative statement as to how the labor force
employed in manufacture for export in 1946 compares with 1938; and how
the volume of exports in 1946 compares with that of 1938.

Question Time in the House of Commons

The President of the Board of Trade (Sir S. Cripps): The estimated
number of insured persons employed in manufacture for export at mid-
1946 was 1,286,500. No information about numbers employed on export
work was collected before the war, and it is therefore impossible to make
an accurate comparison. The figure of 930,000 for mid-1939, which has
been published, is only very broadly comparable, as it was compiled by
quite a different method; it may be taken as very roughly applicable to
1938. The volume of total exports in 1946 was 99, taking that for 1938
as 100; the corresponding figure for exports of manufactured goods was 111.
[February 27, 1947]


Mr. Carson (Conservative) asked the Minister of Fuel and Power how
many gallons of gas oil for use by gas undertakings to make water gas were
imported from the U. S. A. in 1946; and whether he expects to increase
this during 1947.
The Minister of Fuel and Power (Mr. Shinwell): The total consump-
tion of gas oil by gas undertakings in the United Kingdom in 1946 for the
manufacture of carbur.ated water gas was 134,000,000 gallons. Total im-
ports of gas oil from all sources were 492,000,000 gallons of which 349,-
000,000 gallons were imported from the U. S. A., or roughly 70 per cent.
As gas oil is used for a variety of purposes in addition to the manufacture
of water gas, it is not possible to say exactly what proportion of the
American import was used at gasworks.
[February 27, 1947]

Other Speeches and Debates


Text can be consulted in the Library of British Information
Services: those speeches delivered in the House of Lords or the
House of Commons are published in full in "Hansard," copies of
which may be bought through B.I.S. For prices see page 167.

House of Commons, February 5, 1947. Mr. J. B. Hynd, Mr. Richard

House of Commons, February 6, 1947. Mr. Harold Wilson, Mr. John
Strachey, Mr. J. S. C. Reid.

Sir Stafford Cripps. London, February 11.

House of Commons, February 7. Mr. Shinwell, Mr. Eden, Major Lloyd
George, Mr. Blackburn.

House of Commons, February 10. Mr. R. S. Hudson, Mr. Shinwell,
Mr. Churchill, Mr. Crossman.

House of Commons, February 25. Mr. Bevin, Mr. Oliver Stanley.

House of Commons, February 24. Mr. Westwood, Mr. J. S. C. Reid,
Mr. McAllister, Col. W. Elliott


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