§ Order for Second Reading read.
§ Motion made, and Question proposed, "That the Bill be now read a second time."—[Mr. Runciman.]
§ Sir JOSEPH WALTON
I beg to move, as an Amendment, to leave out the word "now," and at the end of the Question to add the words "upon this day three months."
In rising to oppose the Second Reading of the Price of Coal (Limitation) Bill, I wish it to be clearly understood that I would not allow either coal owners, or any others engaged in any trade or business, to enrich themselves by the retention of war profits. Any legislative proposal to prevent this on broad and equitable lines would have had my strongest support, but I condemn this Bill on the ground that it penalises one great industry only and leaves other great industries making huge 1197 war profits to go scot-free. I advocate the principle that the increased incomes of all taxpayers in excess of the average income of the two years ending 30th June, 1914, with one-fifth allowed for extra cost of living, and with equitable adjustment in each assessment as contemplated in case of controlled munitions factories, should be taken by legislative enactment and paid into the National Exchequer as a special war tax towards defraying the cost of the War. The Government, in my judgment, are embarking on the most dangerous and far-reaching policy, which, if not applied equally to all trades and industries affected by the War, is bound to operate unfairly. The only sound principle is to have the minimum of interference by the State in the trade and commerce of the country, and it is on that principles that Free Trade has been so successfully extended and built up for generations past.
I shall be told that this Bill is of a temporary character to meet a special and urgent national emergency. It is difficult, however, to retrace a step of this sort if once it is taken, and I urge the House not to adopt a policy of the nature proposed in this Bill without very serious consideration, or in any haphazard fashion. To say the least the Bill is an alarming interference with the hitherto free right to contract, and it is a violation of the principle of Free Trade. It should not be overlooked in this popular crusade against the coal owners that they have, as a trade, along with their men, shown themselves to be possessed of a very high spirit of patriotism. We have sent no fewer than 230,000 of our splendid coal miners to join the Colours, and they have been encouraged in this by the great majority of their employers. The colliery owners also—that much abused class—are at the present moment paying large sums, to the dependants of the men who have gone to fight for their country in order to supplement the allowances which they get, and in recognition of the fact that they have given up work in which they were earning high wages and have enlisted from a sense of duty to fight the battles of their country. I would submit that the policy of having a maximum price fixed by the State, if adopted at all, must be applied equally in all trades and industries affected by the War. The Government intervention, so far as it has taken place has, I shall be able to show, acted unfairly and with disadvantage to the 1198 country's commercial interests and to the interests of individuals. Take the case of the railways. The State has guaranteed a higher dividend to railway shareholders than in all probability the railways would have earned, and it is also paying three fourths of the war bonus given to railway servants. I heartily approve of that bonus. On the other hand, the State has actually called upon the coal trade to give from 15 to 18¾ per cent, bonus to the miners. I also endorse that and say that miners were entitled to it. But the State did not authorise the coal owners to add that bonus to their pre-war contracts, which they are executing at the present time at a very heavy loss. The colliery owners are prepared to make great sacrifices for their country. They made little protest when the Government commandeered practically the whole of the steamers which had been legally chartered to convey coal to London at 3s. a ton. In my opinion that did not justify the Government in charging for interned German steamers performing the same service 13s. 6d. a ton, when they were allocated to replace the steamers which the Government had taken. I regret that the Government showed little disposition to fairly consider and properly settle claims for compensation. It should not be forgotten that, for several months after the outbreak of war, the majority of the collieries could only work short time, owing to lack of demand and difficulties in shipping, and that they then, in the autumn of the year and in December last, made large forward contracts at prices involving a loss to-day. The partial prohibition of exports has also forced down the price of coal already many shillings a ton. I do not object to supervision and to prohibition when either is necessary to prevent enemy countries receiving coal directly or indirectly, but under the prohibition of export we are losing markets which it will be difficult to regain. Having no outward cargoes of coal raises the cost of freight, and, consequently, the prices of meat, wheat, and other necessaries of life to the consumers in this country. Take the case of the Argentine. We sent out ships laden with coal, and they brought back meat and wheat. The coal paid for the meat and wheat. How are these to be paid for now? Only by decreasing our reserves of gold, selling foreign securities at an enormous sacrifice, or by borrowing at a great disadvantage. Surely 1199 such a policy, increasing as it does the balance of trade already so seriously against us, is likely to prove disastrous to our national interests and ought not to be lightly followed. I have a letter here from a representative of large Northumberland collieries, who says:—Under the Price of Coal (Limitation) Bill, it is going to be impossible for this company to make any profit this year, and, as you know, we suffered heavy losses last year. The refusal of licences for the export of Northumberland coal has brought down the market price nearly 10s. a ton, and has caused a lot of idle time in Northumberland, thereby creating an artificial competition between collieries. A few cargoes are permitted to be exported to the foreigner, the foreigner being the gainer thereby. No coal owner objects to suffering a loss if it is for the good of his country, but the experience of Newcastle shippers, merchants and exporters is that the Committee in London who are issuing and refusing licences display a lack of knowledge of the coal export trade. I feel quite confident that it is not this country but the foreigner who is benefiting by the manner in which the Licensing Committee are working.There is a widespread idea that all coal owners have made colossal profits since the outbreak of War. That is certainly not true so far as regards the majority of the collieries in the districts I know best. The average price realised for Durham coal, as ascertained by the auditors of both the men and the masters, in the first quarter of 1915, as compared with the first quarter of 1914, actually shows a reduction of 5d. per ton. We have heard a great deal from gas companies and railway companies about coal prices. At the end of last year nearly all of the railway companies bought coal for the whole of the year 1915 at prices involving less than cost price to-day. With regard to gas companies, the greatest exaggeration prevails. For instance, the great gas companies of London are receiving to-day, and will receive for months to come, large quantities of coal at less than cost price. If the State now intervenes and arbitrarily fixes the price that we are to be allowed to charge the gas companies, preventing us from recouping the loss—the heavy loss, in many cases—that we are at present sustaining, and at the same time leaves the gas companies free to charge, as they are doing, more than twice the price for gas coke and to exact from the Government enormous prices for toluol and other residual products, that is a one-sided and unfair arrangement. Collieries vary enormously in working cost and the quality of coal. I will not weary the House with further quotations, but I have a letter from the representative of a large group of collieries in Yorkshire, who states that, owing to having sold to the railway companies in December last the 1200 whole of their output for this year at less than cost price, he, having a trust and losing money heavily, is obliged to consider the question even of closing the collieries.
There is no doubt whatever that the idea contemplated in the Bill of fixing a pit-head price and then apparently leaving the merchant free to exploit the consumer to his heart's content is one that is absolutely indefensible. The State, if it interferes at all, must treat all alike. The State cannot equitably fix coal prices and then allow coal consumers to sell their productions at the highest prices obtainable and to earn war profits. It cannot penalise one industry and let all the others go scot free. That is what this Bill proposes to do. If maximum prices are to be fixed for coal by the Government, they must also be fixed for woollen goods and khaki, for leather and boots, for the productions of armament works, shipbuilding yards, engineering works, munition and gas works, and also shipping freights, all of which industries are making war profits. For the State to limit the profit of the coal owner and to allow all great industrial consumers of coal to make unlimited profits is absolutely indefensible. We must go further to secure equality of treatment. Maximum prices must be fixed by the Government, not only for everything needed for the War, but for the whole life of the people, including wheat, flour and meat, and the other necessaries of life. I venture to say that my right hon. Friend never has had, and never will have, an opportunity of introducing a more popular measure. While human nature remains what it is, the consumers of coal, whether manufacturers or householders, will naturally welcome the forcing down of the price of coal below its market value, even if it has to be accomplished by State intervention, as long as they remain un-interfered with otherwise. This general acclamation does not necessarily prove it to be either wise or equitable in the national interest. I rather question if many Members can be found in this House who can give so impartial and disinterested a vote on this Bill as would justify their voting on it at all.
With regard to the provisions of the Bill, I am afraid I cannot congratulate the President of the Board of Trade on the clearness of the drafting. There is not much indication that the scheme has been carefully thought out in all its bearings. This 1201 does not surprise me, because we all know how strenuous a time my right hon. Friend has had recently. Clause 1 tells us that—Coal at the pit's mouth shall not be sold or offered for sale by the owner of the coal or on his behalfat more than a standard amount of 4s. increase as compared with the price of coal at about the same date in the year ending 30th June, 1914, unless the sanction of the Board of Trade has been obtained to a slight additional price in consideration of certain special circumstances. Sub-section (3) of Clause 1 provides that—
If any person sells or offers for sale any coal in contravention of this Sectionhe shall be liable to a penalty. If "any person" sells! That requires a legal interpretation as to who is or is not covered by those words. We are also told that the Bill shall not apply to the sale of coal for export. Export means all coal transported by us from one port to another, therefore, as I interpret it, this Bill does not apply to coal transported from port to port in Great Britain, neither do the provisions of the Bill extend to Ireland, the Isle of Man, or the Channel Islands. If I am wrong in my interpretation of what "export" means perhaps my right hon. Friend will correct me. There is another question on the Bill. Existing contracts are not to be interfered with.
§ Sir J. WALTON
The hon. Baronet says "Hear, hear," but a great many contracts that the coal owners have made have been interfered with, and are being interfered with still further in this particular Bill. I would rather say, if the Bill is adopted at all, that the price fixed under the Bill should begin the day it comes into law, otherwise you will deal very unfairly by coal merchants. I met a merchant the other day who has bought the whole of his supply for next winter at an increase of 6s. a ton. He said his greatest competitor had pursued a safer line, and had refused to buy. Therefore unless it covers all contracts where the price is higher than the 4s. proposed, it really creates very unfair competition between one coal merchant and another. Certainly the extra wages coal owners have to give their miners ought to be added to pre-war contracts. I quite apprehend the position that once you begin to interfere with contracts you should go 1202 the whole hog and act fairly all round. If you begin at all, carry it right through and let everyone be treated fairly and equitably. The difficulty in regard to interfering with contracts entered into at higher prices than are contemplated to be allowed to be charged is that the question also must be considered of pre-war contracts, not yet fully executed, at much lower prices, and I admit that creates a considerable difficulty.
§ Sir A. MARKHAM
Does my hon. Friend say that there are numbers of contracts made before the War which are still running?
§ Sir J. WALTON
Yes, certainly. My hon. Friend is always the fortunate man in the coal trade. If he has no contracts running which were made before the War I congratulate him. I have many contracts running which were made before the War at prices substantially below the present cost price. The effect of war conditions on different collieries varies enormously, and in large new collieries, with every modern appliance, thick seams, working coal close to the shaft, the diminution of output through the enlistment of men substantially recovered by drawing men from other pits with a lower wage average, the cost may not have risen more than 3s. per ton. My hon. Friend smiles. He is one of the fortunate ones whose output is not much, if anything diminished.
§ Sir J. WALTON
My hon. Friend is still fortunate. Many have diminished 45 per cent. In collieries of that description the increased cost owing to war conditions may probably not be more than 3s. per ton. Those collieries under this Bill are to be allowed to make an extra 1s. per ton profit. On the other hand, there are many old collieries working thin seams, often with bad roofs, which entail extra timbering and higher pumping charges, and with costs largely increased by the diminution of output, where the cost has risen 4s. per ton, or even more. The surplus over 4s., it is true, may be adjusted by the Board of Trade, but they are debarred by this Bill from making any extra profit such as the new large collieries can. The old collieries had a much lower margin of profit than the new ones before the War, and under the proposals of the Bill as it now stands, the benefit would be given to those who least need it, and it would operate unfairly. The 1203 vital question here is not the price at the pit, but the price that the consumer will have to pay, and the whole object of this Bill will be defeated if the merchants are left free to exploit the consumer. I see DO provision for the limitation of merchants' profits. I would ask my hon. Friend how much profit he intends to allow the merchants. I understand that he has already arranged with the London coal merchants to charge a reasonable profit, but this only touches the fringe of the question, because there are coal merchants all over the kingdom yet to be dealt with. My belief is that the most unfortunate and lamentable stoppage in South Wales would have been averted, as would many other labour difficulties, had the Government boldly declared months ago that the increased profits of coal-owners and of all other traders, manufacturers and taxpayers during the War would be taken as a War Tax into the Treasury. The Bill will only apply to a very small extent to South Wales, where the bulk of the coal is exported for our Navy or other destinations, and can therefore have but little effect on the present dispute in that country. I think there is coming a general recognition of the fact that the time has arrived when it is our duty to raise a larger contribution towards the cost of the War by taxation. The price of coal affects every householder, as well as every trader and manufacturer, and the surplus profit derived by the Treasury from the coal trade would in reality be a national war levy, so long as the whole of it was scooped in. This does not seem unfair at a time when wages are higher and unemployment practically nonexistent in most trades. If I am not successful in securing the rejection of the Bill on its Second Reading, and if the House will not sanction the taxing of the whole nation through its coal supply, I would suggest that this Bill be limited to fixing the prices which householders shall pay for coal for domestic purposes—not the pit price, but the price they pay when they receive the coal into their cellars—omitting altogether any attempt to fix a price for manufacturing and other purposes. I believe in the national interest this would be a far better and far simpler way of dealing with a most difficult problem. Were this method adopted, of taking into the Treasury all excess profits of coal owners, it would be the most effective means of reducing the price of coal to a reasonable figure, as the coal owner and coal merchant 1204 would have no object or no interest in inflating the price to the utmost degree possible. I fervently hope that in this hour of the country's extreme difficulty the simple plan of taking by legislative enactment the excess profits of all taypayers during the War on the lines I have stated, as a war levy, will be boldly and unhesitatingly adopted by the Government, instead of their bringing in piecemeal legislation such as we have in this Bill, which will operate unfairly between one trade interest and another.
§ Sir RICHARD COOPER
I beg to second the Amendment.
While one welcomes any legislation which is likely to assist the difficulty under which the whole population of the country is labouring, and would readily have confidence in the Government and, in case of difficulty, trust to the wisdom of the Minister in charge of the Bill and sink one's own opinion, I cannot understand how this Bill can touch the fringe of the subject. I think it is extremely unusual for a Bill of any importance to be introduced without the Minister at the very outset, and before one moves the rejection, explaining exactly how he thinks the Bill is going to meet the precise difficulties against which it is framed. That has not happened this afternoon, and to me it is a very extraordinary fact. No doubt later on we shall have the explanation, and when it comes I hope the right hon. Gentleman will make it clear to us and to the people of the country—for, believe me, there is no backing in this country behind the Bill whatever. It may be that they do not understand it. If that is so, I would ask the right hon. Gentleman not to fail to make extremely clear how the Bill is going to assist the people of the country in the direction which I understand the right hon. Gentleman intends it to do, and will later on profess it is going to do. Very few of us are interested in the price of coal at the pit's mouth. We are interested in what we have to pay when we buy it in the various towns, or where we make our contracts for industry, and we know quite well that this 4s. is not the limit of the increased price of coal which we are called upon to pay. There are other increases. They may be necessary or not. There are the great shipping freights, which we heard last time were largely due to the shortage of ships—probably quite a natural, proper and legitimate reason—but it is a difficulty that this Government ought to set itself 1205 to meet in some form or other if they possibly can. Then, lastly, it surely is wrong to say virtually, as this Bill does, that the only people who are bleeding the public are the coal owners, and not the merchants or dealers. I do not believe it. I believe that if anyone has been bleeding the public in the price of coal, it is the merchants and dealers far more than the coal owners. I cannot understand what earthly good the Bill is going to do, and I hope the right hon. Gentleman will lose little time in making it clear to us and the public how it can possibly meet the great difficulty which is exercising the mind of the whole community.
§ The PRESIDENT of the BOARD of TRADE (Mr. Runciman)
I propose to respond at once to the invitation just given me and address the House on this Bill. The object which the Government has in introducing it is to deal with the price of coal at its source, for the simple reason that the price of coal to the retailer must invariably be affected by the price of coal at the pit-head. The hon. Baronet (Sir R. Cooper) suggested that no good would be done by a measure which limits the price of coal at the pit-head, but if he carries his memory back to the discussion which we had last autumn, when we discussed the price of food-stuffs and other materials for domestic use, the subject of coal was treated as being of an exceptional character. Almost everything that we consume in this country, with the exception of coal, is imported from abroad, and the prices of nearly all these articles are world prices. When we discussed the price of wheat we were always met in any proposal for the limitation of the prices of wheat or flour in this country by the fact that the world's price was independent or comparatively independent of the production of wheat in this country, which is not great in proportion to that of the whole world, and that any attempt to artificially lower the price of wheat or flour in this country would tend to drive away from this country supplies that were needed rather than to attract them in far greater abundance. Every speaker in that Debate realised that coal was in an entirely different position. Coal is not imported—it is produced entirely in Great Britain. It was obvious to the House then, as it must be obvious now, that whereas we cannot control the world's price of wheat with any benefit to Great Britain we can control the British price of coal, 1206 because it is produced in Great Britain. That is the first principle which lies behind this Bill. The necessity for it I need hardly say is great. It was perhaps greater then than it is now, but the difficulty of dealing with the situation then was greater than it is now. Last winter, household coal in London was up to a price certainly not below 9s. over the corresponding price of the previous winter. At the present moment it may be taken that the average increase in price over the summer price of 1914 is something like 6s. or thereabouts. That margin is made up partly, it is true, by increased charges made by the merchants for their increased expenses and, it may be, for increased profits, and it is also made up to a large extent by the increase in the pit-head prices.
When one is discussing the price of coal in London you cannot omit the cost of carriage. Coasting freights have gone up to a very high figure, almost unprecedented in the last twenty or thirty years, and the cost of carriage by rail which has remained about what it was before the War is still so high as not to greatly relieve the burdens thrown upon gas companies, electric light companies and corporations, who draw their supply from the banks of the Thames. In other places the rise was also very great, and, I think, due, more or less, to the same conditions. It is quite clear that if, in the coming winter, there was no check on the pit-head price of coal, those who produce and sell coal in the United Kingdom would, owing to the fall in the output and the smaller fall in the demand for coal, have the markets pretty much at their mercy. Large numbers of contracts have already been made, some at only 2s. 6d. or 3s. above last year's prices, and some a good deal more. The needs of some of the consumers have been so great that I have been told again and again that but for Government intervention in the coming winter, when the demands will be pressing from the householder who, as a rule, makes little provision for the winter, the price in London might run up to any conceivable figure. This would have added enormous burdens to the cost of households in London.
As almost every town and village is in the same position it is only fair to point out that even a rise of one shilling represents millions of pounds out of the pockets of the consumer. A shilling rise 1207 in the price of coal used within these shores in a year represents no less than £9,000,000. Therefore, a rise of anything like 9s. a ton, which was the average last year, if it held all over the country—it does not hold all over the country—would come to a stupendous sum. Whatever the rise was, whatever the average over the country as a whole, there is no doubt that the increased cost of coal must have represented something more or less than £20,000,000 over the whole year. This affected every town, every corporation, and every public utility company. The House will remember that on this subject there was an informal Committee upstairs a few weeks ago, on which there were perhaps a larger number of private Members than have met regularly on any one Committee for a long time, all of whom were interested in the high price of coal. Whatever may be said by my hon. Friend who moved the rejection of this Bill, there was no doubt that the consumers, whether manufacturers or householders, did feel the burden last winter more than they could bear, and we felt an apprehension as to what would happen in the coming season if nothing were done to limit prices.
My hon. Friend suggested that this Bill should be limited only to household coal. I suggest that that would be unfair. It would be unfair not only to the householders, who themselves are depending on the manufacturing industries, but it would be unfair to the manufacturing industries and it would be unfair to the State. The State has now large interests in keeping down the working expenses of the rail-ways, and if coal for the railways were to go up 6s. per ton upon last year's prices the Exchequer would be millions out of pocket. Moreover, the demands of the Navy are larger than they have ever been in the history of the country, and an addition of 1s. per ton on the amount of coal which is now being consumed by the Navy would make an enormous difference in the expense of the Navy.
§ Mr. RUNCIMAN
There is no doubt that profits which are made by coal owners or any other business men, if they are in excess of last year's profits, are a taxable subject which will receive the attention of the Chancellor of the Exchequer. Do 1208 not let my hon. Friend run away with the idea that because this Bill is introduced the Chancellor of the Exchequer is not also going to lay his hands on what are called "war profits." There is no reason why we should not take both sides. The Chancellor of the Exchequer will say, in due course, what his taxation schemes are, but I shall be much surprised if he does not find it necessary to tax excess profits and to tax them pretty heavily. The unfairness to other trades to which my hon. Friend referred I think we may pass over. There is one justice we may do to other trades, and that is to enable them to get their fuel without an excessive charge being made upon them. The necessity for the Bill is proved beyond question, and the necessity for it is made all the greater if the House takes into consideration the great reduction in output and the less reduction in the consumption. The output in the first half of last year—that is, from January to June, 1914—was roughly 142,000,000 tons. From January to June this year the output has been reduced to 127,500,000 tons—that is to say, there has been a drop of 14,500,000 in output. The exports have gone down by about 13,000,000, so that the shortage is reduced or helped by a margin of something like 1,500,000 tons. If you take the internal consumption of coal for domestic purposes, household purposes, manufacturing establishments, works of all kinds, by the Fleet and on account of the Army, the consumption for the first half of 1914 was roughly 105,500,000 tons. In the first half of 1915 it will be about 104,000,000 tons. That just about makes the two balance. The naval consumption is so much heavier that it leaves less for the householder and the manufacturing establishments. With a drop in the output so great and with the demand for coal being maintained at such an abnormally high level in war time, it is quite clear that the producers of coal, had they been so minded, would have had the markets at their mercy. The coal owners as a class are not as extortionate as some people imagine, but they are pretty shrewd business men, and if they find offers coming along—
§ Mr. RUNCIMAN
All business men are anxious to get the largest amount they can for what they have to sell. This applies to every section of the community—employers and employed alike. I was saying that if the coal owners find offers coming along week by week at increased 1209 prices it is more than we can expect of human nature that they should refuse these offers made to them. I know that many coal owners have been anxious to keep on good terms with their customers in past years, and they have not put prices up to the full limit which the market would demand. How many contracts that have been made have that sentiment behind them I cannot say, but it is obvious that unless some artificial limit is placed upon prices of coal at the pit-head there could certainly have been no reasonable limit of the burden placed upon the consumer. What has led up to this shortage must be obvious to anybody who has any acquaintance with the colliery districts. The heavy enlistment of miners has greatly reduced the numbers in the pits. Not far short of one in five of the miners have enlisted, a proportion which does credit to the miners and has added greatly to the effective strength of the Army during a period when trench warfare is the custom. There has been a fairly large replacement of those who have gone into the Army, but even allowing for that, we may say that the numbers employed in the pits have been reduced in the proportion of seven to six, and the outputs have been reduced by only 10 per cent. If hon. Members are apt in mental arithemetic they will see that the output has gone down less rapidly than the enlistment has gone up. That means that the men who are still employed in the pits have increased their get per man during the period of the War. The cost of working has also increased, but so far as I can ascertain—and the officials at the Board of Trade and I have taken a good deal of trouble over the figures put before us—it does not appear that the cost of working has gone up in the same proportion as the market price. There is no doubt that all materials have become more expensive, but I shall say a word or two about that later on.
The problem by which we are faced is one of great magnitude, and like all problems which depend so largely on the great variety of producers in the districts from which it comes and the great variety of consumers, it has led to an immense number of solutions being suggested. Nearly everyone thinks that he has a simple way of dealing with the situation. I fear there is no one simple way that is likely to be satisfactory, and I must tell the House frankly that I do not believe that this Bill is or can pretend to be a water-tight measure. It is purely a 1210 measure of expediency. It is endeavouring by rough and ready methods, and the only practical method which has been suggested so far, to prevent prices going up at the pit-head to abnormal figures, and in so far as it does that it will have a dominating effect on the price of coal delivered to the consumer. One suggestion made is that we should take the full range of coal and fix maximum prices all over. Those who make that suggestion scarcely realise what an immense variety of coal is raised and sold in this country. Five or six brands of coal or names of coal are put up in the coal merchants establishments in London. They cover a very great variety of coal, although they are only five or six in number. Wallsend coal has long since ceased to come from Tyneside. Derby Brights may come from any one of the five or six counties in the Midlands. These coals have assumed a sort of nomenclature, which has no geographical significance, and there is no doubt that in arriving at a description of coal, nothing is more difficult than giving it a name which can be applied to it scientifically.
I might point out the great trouble that arises even in a single colliery. Recently I have had brought to my notice one of the large collieries in the North of England where they raise coal from two or three seams, and the variety of coal from those seams is so great that when they get it to the surface they have a dozen different kinds of screenings. I should like any man from outside, when he proceeded to meet the problem in those collieries, to frame a list of maximum prices that would be a sufficient safeguard for the consumer, and would prevent those who had the chance of distributing the coal over the different screens, and also of arranging the different labels when they sell it, from getting to the windward of them. There is no possibility, with the immense variety of coal screenings and the treatment of coal, of framing a list of maximum prices which would be anything like scientific. Indeed, I am quite sure that if we had embarked on anything of the kind we should have been wasting our time over something purely illusory. The best safeguard which we can give to the consumer is that when he makes his contract with the coal owner he will be able to compare what is charged him now with what was charged him or somebody like him last year, that he may be able to see how many shillings above the price charged last year is charged for any description of coal in similar contracts, 1211 leaving the consumer to take care of himself, by enabling him to make sure that under his contracts he will not be charged more than the standard number of shillings per ton.
§ Mr. RUNCIMAN
My hon. Friend is very much mistaken. Every gas company buys direct. Nearly all the large manufacturers buy direct in nearly every one of the mining districts. The only persons who, as a rule, do not buy direct are the ordinary householders, and even this rule is not without exception, because there are many parts of the United Kingdom where even the householders buy direct from the colliery. There is no doubt that the coal owner controls the price of coal. That is the first idea which underlies this Bill. The effort is made in this Bill to fix the coal owner in the price which he takes for his coal. How far can the Bill attempt to limit his prices? The standard of increase which is allowed is based largely on the increased expenses of collieries, expenses which are due to war conditions. During the speech of my hon. Friend who opposed this Bill he was interrupted by my hon. Friend the Member for Mansfield (Sir A. Markham), and in these two Gentlemen we had, I think, at once an illustration of the trouble which we have in arriving at anything like a standard by which to gauge these additional expenses incurred during the War. There is no doubt that in the case of some of the collieries with which I understand my hon. Friend is connected, being in rather old workings, the expenses went up in greater proportion than in the ease of the collieries with which my hon. Friend the Member for Mansfield is connected. Even if that hon. Member were, as he very often does in this House, to give us the benefit of his private experience, I dare say that he would tell us that in the case of some of the older collieries with which he is connected the expenses have risen during the War in a much greater degree than in the case of some of the newer collieries.
With the great variety of plant, workings, and coal-fields throughout Great Britain, it is almost impossible to say beforehand what has been the added expense of any one colliery. All that we have been able to do is to take out some of the various items and to attempt to assess them by the average. The first 1212 added expense to which the collieries have been put comes under the heading of wages. The war bonus awards have added in the Federated Area, which stretches from Lancashire to Warwickshire, and includes North Wales, about 15½ per cent, to the amount of wages paid before the War. In Scotland the war bonus amounts to 18¾ per cent, at the present time. In South Wales it amounts to 17½ per cent. In Durham it amounts to 15 per cent, on the average. Of course this depends on the basis on which it is calculated, but for the purpose of my argument it is immaterial to go into the full technical details with regard to these advances. The important thing is the average. As far as we can ascertain, this means, generally speaking, an added expense to the coal owner, in getting the coal, of something over 1s. a ton in the Federated Area, rather under Is. a ton in South Wales, and considerably under 1s. in many other districts. But of course the variations are upwards and downwards, and even in many districts it is quite common to find some cases where it runs up to 1s. 6d., and others where it runs as low at 7d. or 8d. In the Forest of Dean the addition to wages was 25 per cent, on the standard wages, and that represents something like 1s. 6d. extra added to the cost per ton. If you take the country as a whole, as far as I can ascertain, the extra cost of giving the bonus grant will not be below 9d. and will not be above 1s. That, however, deals with the war bonus charges only. There have been other rises in wages to which the miners were entitled, and that in it self will also add to the expense of getting coal. Then comes the second heading of materials, the cost of which varies very greatly according to the conditions in the different collieries and the different districts. In all cases there is a shortage of pit props. The closing of the Baltic against the export of pit props has added greatly to the cost of working. Pit props are not the only items; there are many others.
§ Mr. RUNCIMAN
May I suggest that if we were to limit the price for pit props below the market level they would be sent to other markets than our own, whereas we want to have them here. But if you allow for the great increase in the cost of pit props, and the increased cost 1213 of other materials, it may be said that the average throughout the whole country, although there are wide variations, will mean an increased cost of over 1s. a ton. After these items, then, we must take into account the reduction in output, which in iself has added to the expense of getting coal. Then there is the cost of maintenance, establishment charges, capital charges, all of which are something more or less constant, and being spread over a smaller output will increase the burden so much per ton. When all the extra expenses are added together, the total amount by which the expense of getting the coal has been increased is something over 3s. How much over I cannot say, but the average has not been less than 3s. Some happy coal owners have succeeded in keeping the cost lower than that. Some of them have already placed their contracts at prices under the standard rate named in the Bill. Four shillings was therefore inserted in the Bill as a figure which was fair to the coal owners as a class and individually, and fair also to the consumer.
I may add that the position is complicated by the fact that, if less than 4s. had been taken as the amount, it would undoubtedly have an effect on the scale on which wages were measured. In some of the coal-fields—in the case of the Forest of Dean, for instance—they have already had a rise of wages based on a 5s. increase. I do not think that the House would care to embark in a reduction of miners' wages by Statute. I am quite sure that no Minister who attempted any such programme would succeed in getting a Bill through, and I do not intend to place the Forest of Dean miner under any disability so far as this Bill is concerned. But if we had taken less than 4s. per ton, it would have an effect not only in the Forest of Dean but in a great many coal areas, and we have to consider therefore, in fixing the standard, not only the coal owner but the miner who is employed. The suggestion has been made that, although this Bill may give relief for the future, it does not help those who have already made their contracts, and that appears to be the main ground on which the Bill is criticised in some quarters. But let the House face squarely the difficulty of dealing with these contracts.
If the contract were a simple one, with merely the coal owners to consider in every case, I have no doubt that it would be possible for the House departing from its usual practice, to tear up existing 1214 contracts and put something else in their place. But the fact is that there are very large classes—and I think it is those whom my hon. Friend the Member for Pontefract had in his mind—who do not buy at first hand. In many cases they buy third or fourth hand, or perhaps fifth or sixth hand. What would be the effect of tearing up existing contracts which had been made-with the merchant? The first effect would be that you would have to reduce the amount which he paid to the coal owner, and then there would be a merchant below him on a smaller scale. His figures would also have to be readjusted. You would have to go down lower to the retailer, whose figure again would have to be readjusted; until, last of all, five or six degrees, under the coal owner, you come to the consumer. Every one of these have made their business arrangements, and have plotted out their contracts for a certain period, and they may have named their prices for their manufactures, and based their profits, on the increased prices which they have paid. And I would suggest to-the House, therefore, that if we were to tear up existing contracts we would have torn up, not only the contract with the coal owner, but would have torn up also thousands of other contracts which have-no direct connection with the coal owner at all, and in all such cases we would have created business injustices and undertaken a task which no sane man would endeavour to undertake unless he were going to reconstruct the whole of commercial England on his own basis and under his own control.
Such a proposition is certainly outside the range of practical politics, and I do not believe that the House could reasonably insist on existing contracts being disturbed by this Bill. But there need be no misapprehension on the part of those who have already fixed their contracts. A great many persons have been looking forward to the introduction of this Bill for some time and are deferring entering into contracts until the last moment, until this Bill is passed, in order that they may get the benefit of it. I hope that they may succeed in getting the benefit of it. If there are others who have not been so shrewd, or who have not been in a position to postpone making their contract, they will get the benefit of it when the new contracts come on. The other criticism of the Bill is that it does not apply to the merchants, and that it should have been made to apply to the middleman. I must 1215 confess that we have not been able to devise any means by which we could reasonably get hold of the middleman's profit, except that of taxation.
§ 5.0 P.M.
§ Mr. RUNCIMAN
I will come to that point in reference to London. There what is called the ring, though I have not been able to trace it in the ordinary sense, has certainly an effect on the price of coal as distributed here. But the ordinary factor, as he is called in some districts, or merchant, buys for all sorts of purposes. That has saved the coal owner a good deal of commercial trouble in many cases, and enabled a regular output to be effected. The efforts to control the prices of merchants have, so far as I know, baffled everyone who has attempted to deal with that question. If any suggestion can be made by any Member of the House, I need hardly say we will welcome it, but up till the present I must confess that I know of no way of getting at the middleman except by taxing him. I would like to make an exception, however, in the case of London, and the same may apply to other large centres where the distribution of coal for household purposes is at present in few hands. Immediately the report of the Retail Prices of Coal Committee was made I put myself in communication with coal merchants in London. Those who are members of the Coal Exchange may be reckoned as something approaching the ring to which the hon. Baronet opposite referred. I did not find a coal ring in the ordinary sense, but no doubt there is something in the nature of a market understanding which enables merchants to keep more or less in close proximity and to keep their prices in fairly close proximity.
§ Mr. RUNCIMAN
Very much the same spirit, except that it has regard to prices. It enables them to keep prices in close proximity, and the prices of coal in London, both in the winter and summer, amongst the merchants proximate very much. There has been talk of extortion in this House and elsewhere, but they were prepared to meet me in the matter and to allow an official of the Board of Trade to look through their books for a long period of years in order that we might see accurately what the annual expenditure had 1216 been in many cases, and to find out how those expenses had risen during the period since the War broke out. So far as I can ascertain, the increase in the cost of handling coal in London has been greater than in any of the provincial towns: the absence of horses, the taking of a large number of motor lorries, and the shortage of labour, together with many other expenses, that have had to be borne by the merchants in London, have undoubtedly led to the expenses going up in a much greater proportion here than in most of the provincial towns. When I met the members of the London Coal Exchange they gave me an undertaking that the price of coal was not to exceed the price of coal delivered to depots in London by more than a certain number of shillings per ton in summer, and they gave me an undertaking that they will make a similar arrangement in the coming winter. In coming to that arrangement, I think I have given a fair basis, and I can assure the House we shall be satisfied so far as they are concerned if they adhere to that undertaking and do not exploit the London consumer, while they gain a fair profit and a fair recompense for the expenses they have incurred.
This arrangement depends absolutely upon the publicity which is given to it, and I propose to ask the merchants to give their concurrence, because I wish to have them with me and would rather have them honourably supporting this scheme. I wish to get from them what would be reasonable prices for their household coal to be distributed in London from time to time, very much in the same way as we published the prices recommended for articles of groceries last August. If that is done it will not necessarily be binding on other coal merchants who are not members of the Coal Exchange, but the publicity that is given to it will, I hope, give an advantage to those who have entered into the undertaking, while not penalising those who are left outside, which was undoubtedly the fact after recommending prices last year in the grocery trade. When the winter comes undoubtedly we shall have to add to that publicity some particulars as to prices of coal of different qualities. So far as London is concerned, I feel more satisfied about the situation than I was last year, when prices went up in an abnormally short space of time to almost panic level. I propose to ask the local authorities in other parts of the country to do very much 1217 what we have done in London, and I hope that by publicity in other large and populous areas, like Liverpool, Leeds, Birmingham, Glasgow, and Edinburgh to make it a matter in which a merchant will feel pride in that he is not blackballed as one of the extortioners, and that he has made a, reasonable arrangement with the local authorities by his being within the limit recommended during the period of the War. That arrangement is the only substitute I can suggest instead of the fixing of a maximum price all round. As I have told the House, I do not believe that to be practicable.
The House is entitled to ask why there was so much delay in introducing the Bill. I may tell the House candidly that I should have been glad to deal with the subject matter of the Bill at an earlier period in the War, but all the factors have been so variable since the War broke out that it would have been unfair to have taken any one of the prices and imagine that it could reach an equilibrium. Pit props fluctuated up to 200 per cent., and other materials also fluctuated. The prices at which byproducts have been sold have fluctuated considerably, and that is one reason why we should not rush into fixing standard rates when no one can tell what the expense of working coal is to be in the future. Another reason in regard to delay is that during the last twelve months there has teen a good deal of agitation and negotiation with regard to miners' wages. In every coalfield except South Wales arrangements have now been made that are to last during the period of the War, and I must say that I hope in the near future arrangements may be made in South Wales of the same reasonable character. Once those arrangements were made, it was possible for me to proceed with the Bill, and at the earliest possible moment 3 have introduced it. I hoped a week ago that the arrangements I had come to with the executive of the South Wales Miners' Federation would have been accepted by that conference. That hope has been frustrated, and although it has been frustrated for a time, I still believe that we have reached now a period in which we can ascertain with a certain amount of assurance what is likely to be the burden thrown upon the producers of coal. That is the justification of this Bill. I have introduced into this Bill an artificial figure, which must be the basis, as there is no common ground that can be accepted.
1218 With regard to the export of coal, I can only say that the Bill does not attempt to limit the price. Foreign exchanges are of more anxiety to us than almost any other financial problem at the present time, and it is by the export of coal that we are able to keep our exchanges equilibrium. If we stop the export of coal we shall have to take to the export of gold for trade purposes, and for the purposes of foreign exchanges coal is gold. If the export of coal is the only way that we have to keep our exchanges equilibrium, it is obvious that the best price Britain can get for her coal from the rest of the world will give us a better chance of keeping our exchanges level than if we were to artificially restrict the prices. I will illustrate this point by taking the case of South America. In this country we buy from South America enormous quantities of meat, maize, wheat, and other cereals. At the present moment the amount of manufactured goods going from this country wherewith to pay for those commodities is smaller than it has been for many long years. Railways are not being extended in the Argentine, and locomotives and rails, therefore, are not going out in the same quantities from this country to the Argentine as in previous years. All our manufacturing output has been limited. The only way, therefore, to keep our exchanges level in the Argentine and to prevent the running up of prices to an extortionate limit is by the export of coal, and the higher the price the coal brings the more likely it is to make exchanges turn in our favour rather than against us. Those whom I have consulted have been overwhelmingly of the view that we should not limit the price of export coal. My hon. Friend asked whether coal shipped from Cardiff for consumption in London is export coal. No; it is not and never has been counted as export coal. Coal which is shipped coastwise and is delivered within the United Kingdom is not export coal. My hon. Friend referred to the Isle of Man; that is within the United Kingdom.
§ Mr. RUNCIMAN
Ireland is within the United Kingdom. Export coal is that which is sent abroad. It may well be asked that if we leave the price of export coal without the limit it would tend to coal going out of the country, rather than being kept for consumers here. In this War we have had resort to many artificial 1219 schemes, and there is one artificial means of controlling the export of coal. We have at the present time an Export Coal Committee, which keeps control of the amount of coal that goes abroad to various destinations. We believe the exercise of the power that Committee possesses will check any tendency to allow an undue proportion of coal to go abroad, leaving in this country a greater shortage than would otherwise have occurred. That Committee must be entrusted with the task of looking after our interests as well, and preventing the coal going into hands believed to be detrimental to our interests. Their powers at present extend to neutral countries only. When this Bill is passed we propose to extend their powers to Allied countries as well. The Committee have means of obtaining a great deal more local knowledge than my hon. Friend suggested, and with the advice and information which they will be able to obtain from the various coal districts, they will be able to keep within this country the coal which we require. That is the reason for the existence of this Committee, and I am sure that it has done its duty well. I commend this Bill to the House, as I said before, not because it is a watertight, economic measure, but it is like a great many other Bills which have been passed since war broke out—it is a measure of expediency. It deals with the most troublesome of all subjects, the most troublesome in my experience—the subject of coal. It does so by checking any abnormal rise of price of coal at the pit's head, the place of origin, and in doing that it gives those who are consumers of coal the best possible chance of buying what they require for their household or for their works within reasonable limits.
§ Mr. RUSSELL REA
The hon. Member for Barnsley (Sir J. Walton) attacked the principle of this Bill and some of its details. He also attacked the Coal Exports Committee and the principles on which it worked. With your permission, Sir, I propose to speak on that subject.
§ Mr. RUNCIMAN
May I, with the permission of the House, make a short announcement. My right hon. Friend the Minister of Munitions and the President of the Board of Education and I are going to South Wales by the six o'clock train. I hope that, perhaps, under those circumstances, the House will forgive me for not being here.
§ Mr. REA
I desire to interpose as soon as possible, because the criticisms which have been made may be followed by other criticisms of the same nature, and I may possibly, as chairman of the Coal Exports Committee, be able to give some account of the principles on which they are acting. My hon. Friend the Member for Barnsley said that, owing to the action of the Coal Exports Committee, prices had been reduced many shillings per ton, and' that by the refusal of licences to Northumberland collieries and Newcastle shippers prices had been reduced by 8s. per ton, and that collieries had been stopped and thrown out of work through the action of the Committee. That is a formidable indictment. It is formidable, but it is not altogether accurate. If the action of the Coal Exports Committee has contributed to the reduction in the price of coal, I do not think from the national point of view that it is altogether to be regretted; but if the action of the Coal Exports Committee has caused collieries to stop for want of orders from foreign countries, that is a pure national loss and is due to some error or fault of the Coal Exports Committee, if it has occurred. I deny that it has occurred.
§ Sir J. WALTON
I know of my own personal knowledge of collieries that have been stopped. I am interested in them.
§ Mr. REA
Nevertheless, I deny that it has occurred through the operation of the Coal Exports Committee. There are districts which are dependent on the export trade for their working. Those districts on the East Coast of England and Scotland have lost their largest customer, Germany, which took from them 9,000,000 tons per year. They have lost their second largest customer, Russia, which took 6,000,000 tons per year. They have also, but not by the action of this Committee, been very much restricted in shipments to Sweden. That has been the cause why collieries have stopped. To all the collieries in these districts which were left open to the operations of the Committee we have been most indulgent. We have given them every licence for which they have applied, except in cases where the shipper or consignee was a black-listed person or an alien enemy, or a suspected person. We have gone further than that, and we have refused to licence shipments from districts where they were able to dispose of their coal at home, and where they 1221 were not dependent on the export trade. I notice that my hon. Friend the Member for Mansfield (Sir A. Markham) cheers that sentence. He has reason to know, as nobody has probably suffered more than himself by the refusal of the Coal Exports Committee to sanction the export of coal from the Midlands of England. To that extent we have benefited those particular collieries of the purely exporting districts. We have actually not only given all the licences which it was within our power to give to approved people, but we have actually contributed to divert trade to those collieries.
When the Coal Exports Committee began its operations we had to consider the question very broadly. We saw that the output of coal was deficient by something like three million tons per month, and we knew that in an article like coal a very, very small deficiency would cause an absolutely incommensurate rise in price. When we had a deficiency of three million tons per month it looked as if there would be no limit to the possible price to which coal might rise. We saw at the same time when we took charge that the exports during the first months of the War had also decreased considerably, by something like 40 per cent. That had been due to the shortage of tonnage and the congestion at foreign ports, especially French ports. We were prepared to find a very large increase in the demand for export coal as the tonnage was released, and better organised to turn round in less time, and as congestion in foreign ports was overcome. Up to that time the price had done nothing but rise, and freights had done nothing but rise. The home consumer was crying out about the deficiency of the supplies and that he was not able to get coal in some instances at any price. Several managers of railways came to us, and one of them told us that he was not able to renew contracts, regardless of price considerations at that time. Public utility works also found at that time their stocks growing dangerously low. I believe the South Metropolitan Gas Company was within eleven days of stoppage at one period. Therefore, the question was a very serious one. The principal object of the institution of our Committee was to preserve our supplies for home consumption, and we approached the question from that point of view. We found this problem: Here is a ton of coal, and is the Englishman who wants it to have it, or is the foreigner, and we preferred the 1222 Englishman to have it. So we began by endeavouring to reduce exports so far as we could safely do so.
We had to look at the geographical situation and at the diplomatic situation, and we saw, to begin with, that the largest consumer of our exports in coal was ourselves, and that a great number of our exports were just as useful to us as the coal consumer at home. For instance, the largest consumer of all is the mercantile marine, and principally the mercantile marine of this country, and it was vitally important that the mercantile marine should be kept going and that all the foreign coaling stations should be supplied. That we took as our first rule. Then we had to distribute between country and country. To shut off coal entirely from the Argentine would have shut off our supplies from there of corn, meat, and other things. To shut off our supplies of coal from Spain would be to shut off our supply of other articles. To shut off our supplies to Sweden and Norway would be to deprive ourselves of pit props and magnetic ores. We had to consider our action in relation to foreign trade in general and foreign trade in particular. Then we had to consider our action in regard to the sources of supply and the different districts upon which coal is produced. In Fifeshire, for instance, 80 per cent, of the product is exported, and to refuse permission to export coal from the Fifeshire collieries would not have meant more coal for the home consumer but would have meant a stoppage of the collieries. If the export trade were stopped there would be no trucks or rolling stock to deal with the home trade, whereas formerly all that was necessary was the little journey from the pit to the ship. They would not have the means there of inland distribution. The railway companies are overtaxed, and they had neither rolling stock nor the means of organising any system of inland distribution, and therefore we found it quite necessary to allow such districts as Fifeshire to export. The same argument applied to South Wales, though the position in South Wales was, of course, immensely mitigated by the enormous demand of the British Navy and our Allies at the present time. The same conditions applied to the Northumberland district.
We had all these things to consider, and our action has been based upon them. We have severely restricted licences from the inland districts of England for exportation, either from the Humber or the 1223 Mersey, because those inland collieries could sell all their coal at home. We have had, of course, from week to week particulars of production, and from day to day we acted in our judgment of supply and demand on the market reports which were sent to us. I may say since we began our operations the conditions have very much mitigated and prices have receded. Prices instead of perpetually advancing have considerably receded, and, those things having occurred, we have, of course, relaxed our operations, and I may say now that we are licensing very freely indeed, excepting to persons who are alien enemies or are suspects on the black lists of the Foreign Office or the Admiralty or other Departments. We find things are better in the London area. The London gas companies and all the companies engaged in works of public utility were extremely alarmed and in considerable danger two or three months ago, and they set themselves to work under an organisation to accumulate stocks in the summer. They calculated that they must get not only a supply equal to their weekly consumption, but also at least 25,000 tons a week in addition, in order to face the winter. I am happy to say that during the last two months or more they have succeeded in putting by not only the 25,000 tons a week which they required, but about 150,000 tons beyond that. So that, on the whole, the situation is not so bad as we feared it might become a few months ago when this Committee was appointed. The production of coal, when you consider the number of men who have left the collieries and gone to the front— and these are the best men—has been extremely satisfactory. The amount produced per man has actually gone up, although they have had in the collieries much less experienced men, who have in part taken the place of those who have gone to the front.
I have now explained the principles upon which we are working, and I hope it may possibly save the time of the House by diverting from my head a good deal of criticism of the nature of that to which I have listened from the hon. Member for Barnsley. I approve the principle of this Bill. Coal is not an absolute but a limited monopoly. It is to a very considerable extent a monopoly, and a monopolist in times like the present can get a monopoly price. I approve the Bill being confined to the pit price, because I think that by 1224 organisation, by administration, the pit price can be reflected in the distribution, if the consumer knows what the pit price is. The consumer ought to be informed by the Board of Trade what the pit price is and what the relation of the legal pit price is to the retail price in his area. He ought to know roughly—that is, he ought to be informed—what is the proportionate advance that he may fairly be asked to pay. Nay, I go further and say that if the Board of Trade will receive complaints from any particular area or district when extortionate prices are being exacted, they can hold the distributor in the hollow of their hands through their command of the railways. Any misuse of the limited local monopoly on the part of a distributor or group of distributors might, if necessary, receive a very severe check from the Board of Trade through their control of the means of distribution.
The new Bill has rightly exempted from the range of maximum prices all export coal, but it has added thereby very considerably to the responsibilities of my Committee. We shall have a much more invidious task in discrimination. A good many of the Midland colliery owners have acquiesced very loyally in the reduction of their export trade, but it will be rather a different matter if they find that perhaps 10s. or 15s. per ton extra can be obtained by exporting, if they can get a licence. I mention this fact because if our action in the past has brought upon us criticism, I must ask that in future we may be treated with considerable indulgence. We shall exercise our discretion as equitably as we possibly can under the circumstances and with our knowledge. Above almost all things, we bear in mind the national value of our coal exports at present. It is a real grief to put the word "refused" on a shipment of good South Wales coal to South America, a shipment which would make across the ocean a considerable credit of national as well as of individual value. I hope that all coal owners will believe that we bear this in mind, and that when the absolutely necessary consumption of this country is provided for we shall be only too willing to sanction exports. We have no wish to assert ourselves; our wish is to efface ourselves, and we look forward to the time when the exporter may even forget that we exist.
§ Mr. WALSH
I think there will be few in this House, and no one outside, but will desire this Bill to pass and to accomplish the object which it has in view. The only 1225 doubt that is in my mind is whether it will accomplish its object at all. If we take our minds back eight or nine months, we may perhaps better understand or appreciate the reason for bringing in such a Bill. What took place in the London market? It is a simple term to use, to say that the London consumer was most disgracefully exploited. Leaving it at that is a simple enunciation of the truth. The President of the Board of Trade said that the reason why he is stopping at a particular increase of pit-head prices is that the pit-head price is the dominating price to the consumer. Nothing can really be more remote from the fact. At the very time when these tremendous prices were being charged to the London consumer the average pit-head price in the federated area, which commands over three-sevenths of the coal production of the Kingdom, was 5d. less than it was in July of the same year. That is to say, the price had fallen almost continuously from July, 1914, until December,]914, the very time at which these tremendous prices were being foisted upon the London public. How the Minister can be induced to believe that the dominant factor in the selling price is the pit-head price, and that once that is fixed upon a reasonable figure all other things will practically accommodate themselves thereto, passes my comprehension.
May I remind hon. Members that the Durham miners send a good deal of coal to the London market? I do not know how much, but I should think that certainly one-half of the total production of the Durham mines comes into the London market and is sold as household coal. I am told by the hon. Member for Mid-Durham that it is fully one-half. I did not want to exaggerate. Certainly one-half of it comes into London and is used mainly for household purposes. At the very time these prices were being foisted upon the London public, the Durham miners were suffering a reduction of wages, because of a reduction in the pit-head selling price. It is very difficult indeed under such circumstances to reconcile the Minister's statement with the actual facts of the case. Will it be believed that for April last, only two months ago, the average selling price in the federated area was only 5d. per ton higher than it was in December of last year? Yet everybody knows that the selling prices in the London market, whence the great cry of despair came, were up 5s., 10s., or even more shillings per ton, although the total average 1226 increase per ton from December of last year to April of this — I have no later figures — was 5d. per ton. I suggest that, these being the facts, and they are indisputable, it is idle to talk about the dominant factor in the selling price being the pit-head figures. There are some people who come in after the pit-had price is fixed. They are legion, and they wear different garbs, but they all have the same purpose—that of making the greatest possible profit out of the people who are least able to defend themselves.
I desire, and I am sure every miner in the Kingdom desires, that prices shall be placed at such a point as not to exploit the public. There is nothing more hateful to us than to think that that which is a necessary of life, a necessary of industry, a necessary in every sense of the word, should be used to exploit the miseries and hardships of the public. Unless you do something in this Bill to stop the middleman, the measure seems to me to be almost worthless. I do not know how you are going to stop him, but there is no attempt at all in this Bill to do it. I myself with half a dozen colleagues have been serving on a Committee for many months, doing our best to organise the industry in the national interests. We submitted the rough lines of a Bill of this character, but we certainly did not leave out the middleman. It would not be an easy thing, it never is, to catch the middleman; but I think it is well within the bounds of practicability to form committees in various areas, establishing zones, so to speak, to place upon those committees people thoroughly conversant with the trade, and to schedule the prices within which coal must be sold to the householder. He is the person for whom I, and, I think, all Members of the House, feel the most keenly. I believe that would be a good way of dealing with the middleman. At present the public are left altogether to his mercies. That is surely not a recommendation in a Bill of this character. We made some recommendations with regard to dealing with exports. I am bound to say that the very explicit, clear, eloquent and statesmanlike statement from the Minister, who stated that coal for the purposes of exchange was really gold, has considerably modified my view. But we do find in the exporting districts that prices are going up with exceeding greater speed than in the inland districts. In the Scottish coal-exporting 1227 districts, the Northumberland districts, and the South Wales districts prices are going up very rapidly. There is not a single person who wishes to interfere with profit so long as it can be kept within the lines of reason, but we do really believe that there should be an ad valorem tax, to go to the funds of the State when the figures reach a certain point, or beyond.
If you can destroy the incentive to extra profit there is really no satisfaction in putting your figures beyond that. At the same time I can see that there is a great deal to be said for the statesmanlike point of view submitted by the Minister of the Board of Trade, and in view of that I do not propose to press my point any further. There is the greatest possible necessity for roping in the middleman. It is all very well to say that if they see the prices in the same way as we published the prices of provisions last year the people will know the proper prices that ought to be paid, and probably will not pay any more. There can be no belief more delusive than that. When you have your children starving for want of a little heat, or the cooking has to be done, with a dozen and one small needs of the family to be met, it is idle to say that a person who buys coal, perhaps by the 7 lbs., 14 lbs., or 28 lbs., knows perfectly well what the schedule prices are and ought to pay no more. It is, I say, idle to talk in that way. I have not the slightest doubt that the Minister means very well, but we must prevent this exploitation. I understand that there is a committee now being formed in London with the object of preventing this exploitation in the London area. Similar committees could very well be set up in other parts of the country. I am perfectly certain that the people who are conversant with the mining industry, men who, from the employers' side, have passed their lives in it; men who have passed their lives in the retail business, men who have passed their lives from the trade union side —they could form a committee which had for its object the prevention of prices going to these famine figures, and could prevent this exploitation. They could do in other well-established areas of the country exactly what the Minister himself is trying to do here in London. We are all convinced that in the truest sense of the term the coal belongs to the people. We are not out for Socialistic objects at all. In this period, when everyone of us, whatever 1228 may be his political complexion, wants to pull together for the truest interests of the State, it is highly desirable that the middleman should be prevented from going upon the rampage to the horrible extent that he did last year. If this Bill in any way is instrumental in its object, then it will be a Bill worthy of support. Unless it does do something towards this end, it is hardly worth giving it its Second Reading.
§ Mr. CHAPLIN
I would like to draw the attention of the House to one aspect of the question which has escaped the attention of the other speakers. It is to emphasise the grounds for the statement which the President of the Board of Trade had to make at Question Time this afternoon. It is absolutely forced to the front by the situation which is still prevailing in South Wales. I will tell the House why. What is the essence of the Bill now before the House? The essence of this Bill is to limit the profits made in certain circumstances by the coal owners. How is that arrived at? It was made, not very long ago, as part of an arrangement between the Minister of Munitions and the trade unions. Unfortunately, however, one side of that arrangement has already been broken by the strike in Wales. Obviously, until those strikes are put an end to, it cannot be either fair or reasonable that that part of the bargain that the profits of the coal owners should be limited should be enforced, when the quid pro quo by which it was obtained has not been fulfilled, or when the whole arrangement has been broken by the other parties to the bargain. I am bound to say that I think we are entitled at least to ask this: That so long as strikes continue this condition ought not to be enforced upon the coal owners either now, or whenever strikes occur. Those who are interested in this question, and who speak on behalf of the coal owners—which I do not myself pretend to do, not being in any way connected with the industry, and never having been in my life—I think in common fairness that this arrangement ought to stand as I have suggested.
I would like to ask one question. It deals with the speech of the hon. Gentleman who has just sat down. Is this Bill really going to be effective or not? I must confess that I had some doubts upon the question; or rather doubts were excited in my mind by a telegram which I received on this subject only this morning after I returned to London. This telegram was 1229 from a well-known coal agent, who is agent for one of the great collieries in the north of England. I am going to take the liberty of reading it to the House, because it so entirely accords with the statement that was made by the hon. Member who has just sat down. The sender of the telegram says:—Effect of the Act is to penalise the producer without helping consumer. It is a fallacy that the bulk of coal purchased direct by the consumer. Much coal purchased by merchants who are not restricted. No reason for singling out coal owners and not restricting merchants or freights. Bill indefensible on that ground: probably useless to consumer whom Government risk benefiting …It is quite true, and I heard it with great satisfaction from the President of the Board of Trade, that he had come to an understanding with certain merchants— that is to say, the merchants in London, and that they had given him an undertaking upon this subject which, no doubt, will be observed. There remains the fact that the merchants are only a comparatively small part, I imagine, of the merchants throughout the rest of the country. As the right hon. Gentleman said, he had good hopes of bringing about an arrangement with them, but that arrangement is not yet in existence, and I am told that there are very great practical difficulties in giving effect to it. I do not know whether my hon. Friend opposite representing the Board of Trade will be able to throw any further light upon this question, and show that it is a perfectly feasible operation which may be accomplished without great difficulty. Unless we have some further assurance upon this subject, the position is not altogether satisfactory to me individually, so far as I am able to form an opinion. I am sure the whole House will have heard with interest just before he eat down the announcement made by the right hon. Gentleman the President of the Board of Trade—as I understood him—that he was going down into the Welsh district accompanied by another prominent Minister. I am sure all of us hope that they may be successful in their undertaking. I am one of those who think that it is absolutely impossible to over-rate the extreme gravity of the situation that prevails, and which I do not believe will ever be satisfactorily dealt with by only making concession after concession to those who have failed to keep a bargain.
§ Mr. LAURENCE HARDY
Although I have no actual right to speak on behalf of the mine owners, yet I believe I am speaking the mind of very large numbers of 1230 those who are associated together in this country in saying that they do not agree with the action taken by the hon. Member for Barnsley (Sir J. Walton) in moving the rejection of this Bill. At the same time they desire to make the very strongest protest that their industry should have been selected as the only one in connection with which very drastic legislation of this character should be introduced. They desire to offer that protest in the strongest possible manner. Every speech which has been made this afternoon only confirms the correctness of their protest. They have accepted the principle of this Bill; but they have accepted it on one consideration only, and that is that they, as others in this country, are a loyal body of men who desire not to raise at this moment of extreme crisis any strong objection to the principle of any Bill which the Government of the day, composed as it is of all parties, consider necessary to bring in for the benefit of the nation. That is the reason they accept the principle of this Bill. They, however, reserve the full right to introduce Amendments, and I trust that those who have authority in connection with this matter will consider these Amendments when they are introduced, and whenever the Bill is taken in Committee.
I should like to ask the hon. Gentleman in charge of the Bill whether he could not see his way to give a little more time, after the Second Reading, for the consideration of the Amendments? I understood it was proposed to take the Committee stage tomorrow. As the hon. Gentleman knows, in an extremely difficult Bill of this sort it is most desirable that the Amendments should be on the Paper, and it will be almost impossible for that to take place, so that Members may consider them, if the Bill is to be taken in Committee tomorrow. I think we must be grateful to the President of the Board of Trade for his very clear statement. Perhaps he himself suffered from the extreme clearness of the expression of his opinions, because all through his subject it was very evident how great were the difficulties in this special action on the part of His Majesty's Government in taking this particular industry and limiting the effects of ordinary competition and trade. We had a very interesting speech from the hon. Member for Ince (Mr. Walsh) only a few minutes ago, in which he, with his very considerable experience from an 1231 entirely different point of view from that of the mine owner, showed how the price at the pit-mouth could not be taken in any way as the concluding basis on which to rely in connection with the price to the consumer, and I think the one thing that must have struck the House in listening to the President of the Board of Trade was that he was fully aware that in this House he was not clearly getting to the actual point —that he had had to abandon the really more necessary action against the middleman on account of inability to find a sufficiently satisfactory solution. Other Members have been exercising their minds on the same subject, and still it has not been found possible to put forward any solution in the matter. Yet is it not evident that this question, if you are going to enter on it at all, cannot be settled unless the question of the charges made subsequent to the pit-mouth are dealt with also by legislation? It is not sufficient merely to bring in a Bill of this sort. You must follow it through, and to follow it through, as everyone knows, means a complication of difficulties and the abandonment of principles in regard to trade. Into difficulties of such a nature even the right hon. Gentleman in this extremely critical moment has been unwilling to enter.
One thing which undoubtedly the mine owners do feel very strongly is that they should have been picked out as the only persons to whom such drastic legislation should apply, whilst they are firmly convinced that the very high prices to which objection has been raised are due very much more to the action of others than of themselves. Up to a very recent period certain contracts were being entered into at lower prices than was the fact before the War, and, therefore, the high prices were not due to the action of the mine owner in very many cases Of course a certain number of cases no doubt come before the public arising out of the small margin which exists after the larger margin is made, but that is a small percentage of the output of the collieries. The larger part is covered by the contracts which, in most cases, are the effect of bargaining between two parties perfectly able to take care of themselves, and these exaggerated prices are seldom applied to larger contracts. Therefore, the mine owners generally have felt very keenly this picking out of their industry and themselves as the one subject for penal 1232 legislation, and they wish to raise their voice against that in the very strongest way. But so far as they do admit the principle of the Bill, they desire to return their thanks to the President of the Board of Trade for his efforts to consult all parties, and to endeavour to obtain knowledge from all in the trade generally in connection with this matter. They are grateful for his statement to-day so far as contracts are concerned. I quite conceive there will be very great difficulties as regards contracts, and that the reversal of contracts would indeed lead to very much greater difficulties than the attitude taken up by the Government at the present time, because if contracts for higher prices have to be dissolved, contracts for lower prices would also have to be dissolved, involving great distress of business in the land. At all events, now the right hon. Gentleman has given a very strong opinion in connection with contracts, and I hope we may consider that matter is fairly settled.
The right hon. Gentleman went into a considerable amount of detail as to the advance of cost. It is undoubtedly true that there may be collieries where the cost in wages has not been so much as is often said, but in the thinner seams, in the older pits, in consequence of advances of wages arising out of the establishment of the Minimium Wage Act and War bonus there have been increases, of course, very much larger than were mentioned by the right hon. Gentleman. In the matter of stores, the mine owners will be left in an extremely difficult position by this maximum price in the Bill. Timber has been mentioned, and everyone knows timber has been fluctuating to an enormous extent. We know also that our maritime warfare is by no means settled at the present time, and it may be a much more difficult thing to get timber in the near future than it has been even in the past few months. There are other subjects now which also are of extreme importance to colliery owners as pits get more elaborate and come under coal-mining Act after coal-mining Act. There are all sorts of new inventions instituted in pits, especially in connection with electrical work, the prices of everything to do with which have increased enormously, and will increase enormously, in my opinion, and will materially affect the course of price in connection with our collieries. All these things—the requirements of collieries, the possible increase of wages, and the further 1233 dangers alluded to by the right lion Gentleman the Member for Wimbledon (Mr. Chaplin)—are still in the future, and yet the margin allowed by the Bill is already in a certain number of collieries entirely used up. It may cau6e a contrary effect to that which the Government desire. It may cause a curtailment of the production of coal. It may be almost impossible for certain collieries to carry on if the prices change in the manner I have indicated.
Although I am glad to see the Board of Trade has reserved the power to increase prices in certain instances, yet I think that is a power probably reserved for extreme cases, and is not likely to be exercised in the case of individual collieries. Therefore it can hardly be relied on to meet the cases I have desired to put forward. So far as the price to the consumer is concerned, there is nothing in the Bill which in any way ensures that the benefit which is given by the Bill does inure to those whom it most concerns. The manufacturing consumer who buys coal may get the benefit of the Bill, but there is no proposal on the part of the Government to ensure that the manufacturer, whatever his trade may be, does reap the benefit of any help he may give. You may, therefore, only be enlarging the profits in certain munition trades, while at the same time you are taking away certain natural profits from an industry. On such grounds as these, I think, it is regrettable that the Government have entered on the extremely difficult task which they were reluctant to enter upon last year, and which they gave very good reasons for not entering upon, but which they have now begun, and I do not think they will be able to stop in the position in which they are placed. You are entering on a new line entirely in connection with industry. It may be necessary. We bow to your decision, because at this time we are bound to accept that which is the considered opinion of the Government at the moment. But I do ask the Government to consider very carefully whether they have in this Bill actually obtained a satisfactory solution in a matter which is full of bristling difficulties, and which will land them, in my opinion, in still greater difficulties. So far as the mine owners are concerned, they have tried loyally to meet the Government in this matter. They hope the Government is right in forcing this upon them, but they do ask the Government that they will con- 1234 sider carefully, favourably and considerately any Amendment which may be put forward by this great industry.
§ Sir EDWIN CORNWALL
I rise to support the principle of this Bill, and to say on behalf of the merchants trading in London and the South of England that, at this time of national emergency and danger, we place ourselves and our services in the hands of the Board of Trade, and the course of our business will follow any lines which the right hon. Gentleman thinks best in the interests of the country. We are indebted to the right hon. Gentleman for his speech on the Second Reading, which, I agree with other speakers, was a clear and useful speech. We are indebted to him for what he said with regard to the London coal merchant. We have heard a great deal of loose talk about exploiting the public. We heard it here this afternoon, at a time when the Government of the day, having examined the books of the London coal merchants, having examined the whole case of the trade in coal in London, are satisfied the London coal merchants are trading in a proper and a legitimate manner. When this question became acute, as it did become acute in the spring, the London coal merchants voluntarily went to the President of the Board of Trade and offered to place before the right hon. Gentleman and the officials of the Board of Trade the books at least of the leading coal merchants of London over a series of years, to prove to the Board of Trade, as they did prove to the Department, that if there is a business in this country or a business in London which is of a most competitive nature it is the London coal trade. If there are any people who have traded for the small interest on their property certainly they are the London coal merchants. When there is a Debate in this House with regard to colliery prices and the prices of coal in London and in the South of England you always hear, when hon. Members like the hon. Baronet the Member for Mansfield (Sir A. Markham) are speaking of prices at the pit, they always talk about the "average pit price." They say the average price at the pit is so much, and then they take the price at which coal is sold in London in a particular week, at a particular time, and at a particular sale; they generally take the highest price they can discover, and use that as a comparison with the average price at the pit.
§ Sir E. CORNWALL
I said the hon. Baronet has referred to average pit prices, and if you take the average price at one end you must also take the average price at the other end. I wish here to state that the President of the Board of Trade and the Government can rely upon the coal merchants of London and the South of England acting loyally by any arrangement that may be come to in order to limit the profits, and to carry out in the spirit as well as in the letter any policy which will satisfy the Government and the public that there is no exploitation of the people with regard to the supplies of coal. I have been connected with the coal trade from my youth upwards, and it is no satisfaction to me to hear hon. Members say that I am engaged in a business which is exploiting the public. I am sure if anyone would come and see my books and see how my business is carried on he would go away convinced that their statements are perfectly unfounded. If any arrangement can be come to with the Government to satisfy the country that these statements are unfounded, no one would be better pleased than those who are carrying on the coal business in London and in the South of England. The right hon. Gentleman the Member for Ashford (Mr. Laurence Hardy) said he questioned the wisdom of the Government in picking out this particular industry for legislation, and he said that it was not fair that the collieries should be picked out and not the merchants. If the right hon. Gentleman had told the House all the facts it would have been clear that it is entirely the fault of the colliery owners that there is any legislation at all, because the President of the Board of Trade has been negotiating with the colliery owners for months to try and get them to come to a voluntary arrangement which would regulate and modify the pit prices. If the right hon. Gentleman had not been carrying on these negotiations all these months legislation in his direction could have been brought forward sooner, and therefore the colliery owners are entirely to blame for this legislation.
The hon. Gentleman (Mr. Pretyman) who is now representing the Board of Trade will, I am sure, bear me out when I say that the President of the Board of Trade has been negotiating for months with the coal owners in the hope of coming to a voluntary agreement to avoid 1236 legislation. That he does not dispute, and therefore for any colliery owners to complain of this legislation is quite unjustifiable. It was part of the case of the right hon. Gentleman that when he met the colliery owners they said, "If we reduce our prices we have no guarantee that the merchants will reduce theirs." We immediately went to the right hon. Gentleman and assured him that we were ready to give that guarantee, and therefore I say again that it is entirely the fault of the coal owners that this legislation is necessary. May I remind hon. Members when they talk about the prices of coal in London and the so-called middlemen they can always buy coal in London from the Army and Navy Stores, the Civil Service Stores, Harrod's, or Whiteley's, because all these firms engage in the coal trade, and I would ask are they exploiters of the public or have they entered into a "ring"? You have only got to look a little more closely into the actual circumstances and get away from these rather reckless and careless statements in order to see that the London market for coal, as it is for everything else, is subject to the keenest competition that can possibly be. There is always this difficulty that in regard to any article consumed in a large centre, competition reduces the price to a very low level at one moment, but the price at that particular moment may not always be a fair average basis. You must not take the price at which an article is being sold at one particular time, but you must take an average price covering, the year.
Having said so much about the London position, I want to draw the attention of the President of the Board of Trade to some views upon the Bill itself. I heartily support the principle of the Bill because without legislation or voluntary agreement I agree with the President of the Board of Trade that the outlook next winter in London will be most serious, and if you get a Bill of this kind or a voluntary arrangement it must steady prices. You want some measure of this kind to steady prices next winter, and the question is not so much what the price of coal is now, but what it would be next winter if there was not some legislation of this kind or some voluntary arrangement. We hear a good deal about the present price of coal. The President of the Board of Trade was perfectly right when he said that but for some step of this kind no one knows what the price of coal will be if we 1237 have a cold winter. I am sure everyone inside and outside this House will appreciate very much what this Bill will do by steadying the price of coal at a time like next winter when there will probably be a scarcity. With regard to the machinery of the Bill I think it is extremely difficult, and many difficult points arise. It is quite clear that if we had not had all these negotiations this Bill could have been brought in three months ago. I think the President of the Board of Trade will agree to that proposition. The reason it was not brought in before is that the President of the Board of Trade hoped to come to a voluntary arrangement with the coal owners. If the Bill had been passed three months ago we, should have avoided the contracts which have been made at very high prices, because this Bill will not apply to contracts.
I notice that the right hon. Gentleman who spoke for the coal owners said he was very glad that it did not apply to contracts. In my opinion this Bill ought to apply to contracts, but it ought not to be retrospective from the point of view of any coal delivered, but it ought to apply to contracts from the date of the passing of the Act, otherwise you come up against very great difficulties. Take the case of the manufacturers of coal. Many merchants throughout the country have made contracts for manufacturing coal from 7s. to 8s. of an advance over last year. Some of that is sold, and some of it is unsold. The consumer who has bought is naturally up in arms, and will not buy because here is a Bill which limits the price to 4s. on last year. That which is unsold cannot be sold at the advanced price of 7s. or 8s. which the merchants have to pay. There is another case which has been brought to my notice only to-day. It was mentioned to me last Friday, but the particulars only came to me to-day. It is a ease where a coal merchant had a contract running which ends on the 3lst October, and the colliery company came to him and said, "If you want this coal next year from the 1st of November, you will have to buy it now." The coal merchant said, "I do not want to buy it now, because I cannot deliver it to my customers now." The colliery company replied, "If you do not buy it now, we cannot guarantee that you will have the coal on the 1st of November." Consequently this coal merchant, on the 8th of this month—I am speaking of a large firm not only in London, but throughout the country—was practically compelled 1238 by the colliery company to enter into a contract of an 8s. increase over the price of last year, which governed the corresponding period referred to in this Bill. This firm signed the contract on the 8th of this month to have the deliveries from the collieries on the 1st of November next, although they will not be able to sell it to their customers. If this merchant had refused to buy the coal at that time he might have found himself without that business at the end of the autumn.
From an ordinary business point of view hon. Members might say that this merchant ought not to have bought the coal. I will give another case, that of Messrs. Cory, who are large coal dealers in London. A Northumberland colliery came to them and wanted 17s. 6d. a ton for the coal at the pit, which is 1s. 6d. more than the Bill would allow. This firm said to the colliery, "No, we shall wait until we see what legislation is carried through by the Government." They did not order the coal, and subsequently they had a letter from the colliery saying that they had sold half of that coal for export purposes, and the firm I am alluding to can only have half the quantity they could have had a week ago. I know of another case where a firm refused to buy the coal because they were waiting for this Bill, and they have lost half the coal, and will probably lose the other half of their contract. In the light of these facts how can the Government fairly say that this Bill shall not apply to contracts? I say that the Bill ought to apply to all contracts from the passing of the Act, even if the Government made the figure 4s. or 5s., or a figure which would be acceptable to the collieries. It is no use having an arrangement or a low figure in the Bill if that low figure prevents you getting the coal. It is poor consolation to London, and the districts around London and other parts of the country, for us to pass a Bill which, and although it is all right from the point of view of argument and discussion here, in practice it would mean that you do not get coal for your customers in order to enable you to carry on your business. In my opinion it is of the utmost importance that the Bill should apply to contracts, and it would be better to make some other modification to fit in with a fair and equitable arrangement with the collieries than to allow the contracts to run over next year.
You must bear in mind that 80 per cent, of the coal produced in the country has 1239 already been sold under contract, and if this measure does not apply to contracts then you are passing a Bill which deals with a very limited supply of coal. It is really doubtful whether London will get any of that supply of coal. If hon. Members will look at the Bill, they will see that the words of the first Clause say that it is only to apply to coal of the same description sold in similar quantities and under similar conditions. The House will realise, if it is coal only "of the same description sold under similar conditions," and you have only got a very small quantity of coal left for sale, how easy it will be for the coal owner to say that he has none of that limited supply of coal of the same description which he can sell under similar conditions and in similar quantities. There are no similar conditons. War has altered all conditions, and, if the colliery like, they can withhold from anybody any of this coal which is outside contracts and which this Bill says is to be sold at not more than 4s. over the price of two years ago. Is not that a serious matter? Will not the Board of Trade between now and the Committee stage consider whether they cannot bring in contracts from the passing of this Act, and on terms which will be acceptable to the collieries? Do not let them hold too fast to the 4s. That is not so important, or half so important, as getting the coal; and in my opinion, unless contracts are brought in, this Bill must break down in the working.
The President of the Board of Trade, with regard to house coal, said that those who had made contracts had not shown so much prudence' as they ought to have shown. Who, trading in coal, could have dared, after the experience of last winter, to keep out of the market three months ago? The whole object of everyone who would want coal during the next twelve months was to secure coal—that was the essential thing—at the lowest price he could. We went to the Board of Trade and agreed upon four things. We undertook not only to limit our profits but to buy coal. That is why the President of the Board of Trade was able to-day to say that there was more coal in London than in June last year. In answer to the hon. Baronet the Member for the Mansfield Division (Sir A. Markham) a few days ago, the President of the Board of Trade said that there was more coal in London in May this year than in May last year. Of 1240 course, it was part of our arrangement with the Board of Trade that we should buy coal. We kept our high-price coal in May instead of selling it as usual, and we bought high price coal in June. If we had done what the President of the Board of Trade today suggested that we should have done and had waited for this Bill, we could not have carried out our bargain with him, and instead of his being able to say to-day that there was more coal in London than at this time last year there would have been no stock, but actually a shortage. Instead of that, we stocked coal on every inch of ground we had, and we have put down every bit of coal we could at high prices. That was part of our bargain. We have also urged our customers to buy at the present prices. We have told them that they ought to buy. The Government, too, have told all the local authorities in London and in the country that it is their business to get in their coal quickly, and boards of guardians, the Metropolitan Asylums Board, lunatic asylums, and other large institutions carried on by the local authorities of this country have been buying coal. Now the Government come along and say, "We will bring in a Bill, and the pit price shall be from 1s. to 1s. 6d. per ton less than the contracts you have made for the coal you have bought." That is not good business, and it is not the best way to deal with this subject. Speaking for myself, we are not going to-quarrel with the Government during War time even if they pass this Bill just as it is, whatever injustice may arise, because the interests of the country are far in front of any other consideration. But here is the House of Commons dealing with this Bill, and it is not yet too late to make it a better and more workable measure. The object of my remark is to persuade the Government to modify and amend the Bill, so as to make it more workable and more suitable for the conditions to which it pretends to apply.
There is no guarantee under the Bill that the collieries will supply this small amount of coal which is left outside contracts. Some provision should be put into the Bill making it the duty and the responsibility of the Board of Trade to see that consignments of coal are sent to those parts of the country where there is a particular shortage and where coal is most needed. The hon. Gentleman who represents the Board of Trade will see that those engaged in the trade are naturally 1241 anxious as to how this will work. Whilst in the case of South Wales there may be a very large increase in price and a difficulty to cancel contracts, I believe, with regard to the Midland coal owners, that it would be easy to make an arrangement which would be fair to the colliery owners, to the merchants, and to the public. In spite of what the President of the Board of Trade said, I believe that the bulk of the coal business is done between the collieries, the merchants, and the consumers. There are factors who supply a certain part, but they do not deal so extensively as people imagine. The main work is done between the collieries, the merchants, and the consumers, and I believe that it is not too late now, if the President of the Board of Trade would get the coal owners and the merchants round a table with himself, to get out a little more workable scheme than the present Bill which, as it is now drawn, will not work fairly. I hope that the principle of the Bill will be accepted, and that hon. Gentlemen will help us in Committee to get it amended.
§ Mr. JOHN O'CONNOR
I desire to say a word or two with regard to the collieries in Ireland. Probably it will come as a surprise to many persons in this House to learn that there is a colliery in Ireland. Yet there are a few collieries there, and I wish to impress upon the promoters of the Bill that those collieries are entitled to separate treatment. The collieries in Ireland carry on their business under very different conditions from the conditions under which the collieries in this country are conducted. The House should regard the few collieries in Ireland as infant industries and therefore entitled to the different treatment I claim for them. What are the conditions under which the colliery business is conducted in this country? They have all the railway facilities and dock facilities for the purpose of carrying on to the best advantage the business in which they are engaged. These conditions do not exist in Ireland. The collieries in Ireland are remote from railway heads, remote from docks, and in many cases they are only resuscitated old workings. To apply this Bill to collieries which carry on business under these conditions would mean their absolute and complete ruin. When I speak of these small collieries without these railway facilities, it also follows that all the requirements for the collieries have to be carried there at great expense. There- 1242 fore, to impose the restrictions contained in this Bill upon these small infant industries would mean their complete ruin. I am not asking an unreasonable thing in asking the Board of Trade to exempt Ireland from the operations of this Bill. No doubt it will be present to the minds of hon. Members that in any other measures that have been applied to conditions within the limits of the three kingdoms Ireland has been of late separately and differently treated. What is the motive of that treatment? It is because this House in all its parts has been convinced that the conditions of Irish trades and manufactures in the past have been so detrimental to the prosperity of the country that in order to assist them Ireland has been on a few occasions separately and differently treated. There is no industry in Ireland which requires this separate treatment more than the infant colliery industries that are now being resuscitated in a few parts of the country. It is not too much to say that they are infant industries. Some of these workings were carried out in the past and had to be given up. Now some men of enterprise and with some little capital have devoted themselves to reorganising these old and almost played out workings, and if you impose upon these men engaged in this patriotic effort additional restrictions, the only thing that must naturally follow will be the arrest of their attempts to resuscitate these once flourishing industries.
No evil can follow from exempting Ireland from the operations of this Bill. It would not be possible for the owners of these small collieries to put any additional price of an extravagant character upon their output, because the restrictions that you place upon the trade here will indirectly influence them in their prices. Let it be known to Members of the House, who no doubt consider this matter from a business as well as from a patriotic point of view, that most of the coal that is raised in Ireland is bought at the pit-head by persons who themselves consume it. They carry it themselves in a great many cases along the roads in their own carts. There can be no jealousy between coal owners on this side of the Channel and the smaller coal owners on that side in regard to this matter. The restrictions which will be placed on the trade here will indirectly affect us. I ask the Board of Trade to consider this point, and I hope the promoters of the Bill will, on the Committee 1243 stage, accept some Amendment which will carry out what I believe to be necessary in regard to Irish collieries, and will remove Ireland from the operation of the Bill.
§ Mr. DICKINSON
I am unable to speak on this question, as an expert, a colliery owner, or a coal merchant, but I can speak as the representative of a constituency in London in which there are a very large number of poor people who suffered enormously under the conditions of coal supply which obtained last winter. I hope therefore the House will allow me to address to it a few observations on this question from the London point of view. After all it was the condition in London last year that mainly gave rise to the inquiry by the Committee, and I venture to submit to the House that the condition of the vast masses of the poor in London during the present War is a matter of the greatest concern. The dissatisfaction aroused in London last winter was so enormous that if, next winter, we have a repetition of the same thing, I fear trouble may arise such as we can hardly anticipate at the present moment. This is a question which affects the London poor more than any other class. Let me give some figures as showing this. The poor of London are served chiefly by a system of hawking coal from door to door in trolleys. If you take the rise in prices last winter between the months of November and February you will find that whereas the price of the best coal at the pit mouth rose in that period by 3s. 5d., and the cost of the coal delivered to the ordinary consumer in customary quantities rose by 7s., the cost of delivery to the very poorest in London rose by no less than 11s. 8d.—from 26s. 8d. per ton in November to 38s. 4d. per ton in February. London, therefore, deserves very special consideration. The President of the Board of Trade himself has recognised the necessity of making special arrangements for the supply of coal next winter, while the Committee which investigated this matter included amongst its five recommendations one to this effect:—That steps shall at once be taken to consider, in consultation with the public bodies concerned, the question of the accumulation by such bodies of reserves of coal in or near London for the use of small consumers during next winter.So far as I know, nothing has yet been done in that respect. The London County Council have considered the matter, but has come to the conclusion that nothing 1244 can be done. The prospect is one not pleasing to look upon. One of the witnesses who perhaps knows more about the trolley trade in London than anyone else said he anticipated that the price of coal sold to the poor of London would probably reach no less than 50s. per ton. What does this Bill do to prevent such a thing occurring? I am very much afraid it may fail to carry out its purpose. It limits the price of coal at the pit mouth by adding 4s. to the price which that coal fetched in 1913—two years ago. The President of the Board of Trade goes further than that in respect of London, because he says he has made arrangements with leading London merchants by which they agree to limit the addition to their prices by some figure not yet announced. I doubt very much whether this agreement is at all universally accepted by the coal merchants in London. I have been told by one who carries on a very considerable trade in this particular branch that he knows nothing of the agreement. But even if the agreement of a number of merchants in London should have the effect which the President of the Board of Trade thinks it will have, are they so powerful in their influence upon other merchants that the latter will follow in their wake?
Still that does not meet the question of the sale of coal by trolley, and I cannot see how anything is going to limit the condition under which these sales are carried on by fixing the prices at which the coal is to be sold. A great deal of the increase in price is due to the increase in commission which the trolley man himself receives. But it is due also to other causes, and I am told that one of the reasons why trolley coal is so expensive is that the merchant has to deal with a large number of bad debts and has to put up the price in order to cover them. The trolley system is expensive alike to the merchant and to the consumer, and I believe that the bigger merchants in London would be very glad if they could get rid of this system of trolley sales, and start some other system of supplying the poor. It seems to me that there are two methods that might be adopted.
The first is to definitely fix the maximum for London. I quite appreciate the difficulty of fixing a maximum all over the country, but that does not apply to anything like the same extent in London. If the arrangements which are foreshadowed by the President of the Board of Trade with a view to securing a supply of coal 1245 for London should be carried out, and if that coal is to be sold to persons in the ordinary way and to be delivered at a fixed maximum price, I do not see any difficulty in fixing the pries in London. But it appears from the evidence given before the Committee, which went very carefully into the question, and took a good deal of testimony of a very interesting nature on; this point, as far as I can see it was perfectly possible, taking coal at 11s. at the pit mouth, which was the price in 1913, to fix the freight rate at 8s. 11d. per ton, and the cost of distribution between the depot and the consumer at 7s. 6d., and that would bring the price out of the coal purchased by the ordinary consumer at 31B. 5d., providing the price at the pit mouth is 15s., this including the ordinary charge of 10d. paid to the man who brings the coal to the door and delivers it, instead of the very large commission which the trolley man earns at the present moment. This might knock out the trolley man altogether. Perhaps that is a disadvantage, because it might injuriously affect poor people who buy their coal m that way, and it is conceivable it might make it more difficult for the people to get coal than at present.
I therefore suggest that if that method cannot be adopted of actually fixing the price at which the coal is to be sold to anybody in London, there might be a better method of distribution, and I believe that might be provided for in this way. It is quite possible to supply the small consumer cheaply. It is done by a number of agencies in various places. For instance, the directors of one of Guinness's buildings said, last February, that they had a system of supplying coal to their tenants at 25s. per ton, whereas in the very same street trolley sold coal was being supplied at 38s. 4d., so that the tenants of Guinness's buildings got their coal at 13s. 4d. per ton less than the tenants of the neighbouring houses got theirs from the trolley man. The same thing is done by other agencies, by, for instance, the London Philanthropic Agency, and through coal firms. I suggest that it should be made universal, at any rate during the War, and that we should have a system whereby it will be possible in practice to deliver coal at any poor person's door in London at the present prices. I suggest to my right hon. Friend—I do not know whether there is time between now and the Committee stage of this Bill for an Amendment to be made—that he gives due consideration to it and that the Metro- 1246 politan borough councils and the councils in the surrounding suburbs of London may be made use of for this purpose, by giving them power to issue coal tickets at a definite price, so that every poor person who wants coal in small quantities can go to the town hall, or some other office established for the purpose, and buy a ticket which will enable him to go to the coal merchant and get what he wants.
I believe most of the coal merchants would be willing to fall in with such a plan. These tickets could be presented in the way which is done by philanthropic associations and the coal delivered by the merchant to the purchaser's house, as is done at the present moment under the system to which I have alluded. Some merchants themselves do it at present. Some do a very large trade through the London Philanthropic Society and similar institutions. I believe if this system were made universal the borough councils would be able to carry out the work perfectly satisfactorily, and we should be sure that no poor person in London next winter would be unable to get coal at the maximum monthly price. If there are people who prefer to live on credit, or who have no cash with which to pay for the ticket, very well, let the trolley system go on, but I believe the great mass of the people will soon learn that they can get cheap coal in the same quantities as is their custom, and they will make use of the new method. Thus we shall get over the difficulty. I only hope something of the kind can be done and a wide publicity will be given to the scheme, so that everybody may understand the advantages to be derived from it.
I want to say a word or two for London with regard to contracts. I cannot help thinking that the insertion of the Clause in this Bill that it is not to affect any contracts, will rob it of nine-tenths of its value. I am told by a coal merchant in London that at least 70 per cent, of the coal required for London has already been bought. An hon. Friend near me—who knows a great deal about the subject— says 80 per cent, has already been bought, but, at any rate, I gather that already contracts have been entered into to the extent of 70 per cent, of the supply for next winter. I quite understand one cannot alter the arrangements that have been made for coal which has been actually sold. I do not even go back on contracts of very long standing, but it was given in evidence 1247 that contracts are usually made for London in April, May, or June; indeed, the greater number of London contracts are made in June, and the Report of the Committee on this question was issued on the 24th March last. I see no injustice in the present circumstances of saying, in regard to any contract entered into since the date of that Committee, when there was clearly some notice that there would be a change of some kind or other, that the contractors should not be held absolutely to the figure mentioned in the contract. I would suggest to the right hon. Gentleman that he might include in this Bill some provision that contracts made between the 24th March and the date of the passing of the Bill should be subject to revision—a revision strictly on the one point of so adjusting the price that it should be brought into an equality with the price that would have been the price of the contract had the contract been made under the conditions of this Bill. If any dispute arises it could easily be settled by the County Court, because in the great majority of cases the question would be one merely of arithmetic and everybody would be able to get a revision. There is no reason why anybody who has bought coal for 32s. or 35s., and who finds that the price at the pit's mouth has been cut down by 4s., should not claim to have his contract brought back to that price also, so that be should be put on an equality with the other people who have not made their contracts but have waited to see what would happen. That would do justice all round and to the consumers, particularly in London, who have suffered by the delay of the Government—it is due to the delay of the Government that we have not had the Bill sooner—and it would do justice, not only to owners of coal mines but also to coal merchants, for each of them would be dealt with in the same way by a fair revision of the contract. I hope there will be some opportunity given for the discussion of Amendments on this Bill. I was glad an hon. Member opposite asked that the Committee stage should be postponed at any rate over to-morrow, and I trust we shall have some little time to consider the actual wording of the Amendments, otherwise the discussion will not be half so valuable as it would be if we had two or three days or even only a couple of days to consider what Amendments should be put down.
§ Mr. PARKES
Allusion has been made to the question of contracts. There is one point in favour of interfering with them at the present time—although we know that in England contracts have always been regarded as inviolable, and we hope that that will remain so—that is, that the coal owners themselves in the Midlands, where coal has gone up so much, were compelled to ask the buyer to pay so much extra upon the contract price. That is a new departure in this country, and the only reason I can see for traversing these contracts from March up to the present time. As a rule the contractors will not suffer very much on account of the contracts made during the last few months. This Bill is a, departure, and a very important departure, in the trade of this country. It is rather a hazardous departure, and one which is likely to extend, because people will say, "Why cannot we have our industry regulated by the Government?" and it may grow into a great abuse. I am sure, however, that it is a courageous attempt on the part of the Government to settle a question which has been before the public for some time, and if it can settle it satisfactorily it would be a very good thing.
I am afraid there will be a great deal of complication and confusion about the matter. Everybody who knows anything about collieries knows that the conditions in one colliery are almost universally different from those in the next one. You cannot fix a price which applies to all. You cannot fix a sum which would be suitable to the increased cost of all coal mines at the present time. Four shillings for this short time may be a very insufficient sum to allocate for the difference between last year and this year. Individually coal owners would be thrown into confusion as to how they are to keep their coal at one price. I can understand the taxation of surplus or high profits, but the fixing of certain prices for special articles or commodities is a very different thing. What will be the increase on 4s. per ton by the time the small consumer gets his coal? It has to go, as we have heard this afternoon, very often through five or six hands, and there is the variation in the cost of carriage and a multitude of other things which go to make up the price. With a manufacturer and a large consumer like a gas works the conditions are, of course, somewhat different, because it is almost universally the case that the coal goes 1249 direct from the pit's mouth to the manufactory or the large consumer of coal, and there are no middlemen between one and the other. It is possible for the large consumer of coal to look after himself a great deal better than for the small consumer.
I was very much struck with the speech made by the hon. Member for the Ince Division (Mr. S. Walsh), and one or two other speeches made since. To my idea the most important part of the scheme is the reduction of the cost of coal to the poor people of this country. If we can accomplish that as a result of this Bill it will be a great thing, and the people will be grateful for it. A great deal has been said about London having organisations which supply coal at reduced prices to the householders. Why cannot that system be established throughout the length and breadth of this country? I have had some experience with regard to the working man, and I know how, in a hard winter, the price of coal presses upon him. I have had a man come to me and say, "My coal has gone up." These people very often buy by the hundredweight, and sometimes by the pennyworth. Suppose a man consumes 3 cwts. per week. If the price goes up 6d. or 1s. per cwt., as it often has done, that man has to pay from 1s. 3d. to 3s. extra for his coal per week. In many cases that is a great hardship on a man receiving, perhaps, 24s. or 25s. a week, and to put an extra tax upon his coal of 2s. or 3s. per week is a very hard thing to do. From my own experience during the last year or two, I know that the question is more important to the smaller man than to the large consumer, although we know that coal is an important question for the manufacturers of this country, and that prohibitive prices interfere with the possibility of doing trade. At the same time, our efforts should be concentrated on the lines set out by the last speaker, namely, that throughout the country committees should be formed, if necessary, in municipalities to take up the matter and to see to what extent we can get reduced prices of coal for the poor people of this country. It is a very great departure and a big thing to undertake. If what I have sketched out is done, I think the scheme might be approved.
§ Sir A. MARKHAM
This Bill is the result of a proposal that I made to the "Government last January. I saw the Prime Minister and the President of the 1250 Board of Trade and urged them to adopt the principle which has now at this late hour at last been embodied in the Bill. But the Bill as now presented to the House is absolutely worthless so far as the general consumer in the country is concerned. It fails in two important points, which renders it, in my opinion, of no value whatever to the general consumers who buy coal in small quantities. I do not think it is possible to fix a maximum price for coal in any district, as my right hon. Friend (Mr. Dickinson) has suggested. May I point out to him that the differences in railway rates alone for bringing coal from Yorkshire and Warwickshire to London represents some 3s. a ton. Therefore, it is extremely difficult to fix any rate which should apply all through the country. The Government set up their Committee. It was a Committee which did not include one man who had any knowledge of the coal trade. Naturally it was the ordinary procedure of the Government to appoint a Committee of those who knew nothing about the subject, and the result was that when they produced proposals to the President of the Board of Trade he had to reject them. We had, therefore, to get back to the basis of taking the prices obtained by each colliery for a certain class of coal at a certain period before the War. I represent in this House not colliery owners, but collieries.
I am not going to follow the dispute between my hon. Friend the Member for Barnsley (Sir J. Walton) and the hon. Member for North-East Bethnal Green (Sir E. Cornwall), who appeared to be squirting ink at each other, one saying that the merchant had had the profit, and the other that the coal owner had had the profit. Let me put this to the House: The merchants say that to-day they have purchased 80 per cent, of their coal. Let us say that at this time last year they had purchased only 70 per cent. The coal owner says that he has not had all the profit, and the coal merchant says he has not had all the profit. Who has had it? It is quite clear that somebody has had their finger in the pie, and that the coal owner and the merchant together have had this big price which the public have had to pay. If coal merchants were buying coal this time last year at a lower price and subsequently sold it at 11s. above that at which they purchased, somebody, whether the merchant or the owner, has had the difference. The hon. Member for Barnsley says that you are going to penalise the 1251 coal trade, and he asked why should the coal trade be specially selected for legislation at the hands of this House, and the right hon. Gentleman (Mr. Laurence Hardy) took the same view, that it was unfair to single out one particular trade, while leaving other trades alone. If the Government had, in the first place, made a definite pronouncement that all surplus profits over and above the average of the preceding two or three years before the War would be taken by the State, you would have had no strike to-day in South Wales, and the position has been aggravated all through by the Government delaying till the last moment to take any step to let people, and more particularly the miners, know where they stand. I have lived all my life among miners and know something about this class of men, and when they see coal being sold at 30s. a ton they say, "If the colliery owner is to have his share of the plunder, so are we," and if the Government had said that all surplus profits were to go to the State and that no one is entitled out of the necessities of the nation to make money during the War, the whole position in the coalfields would have been entirely different from what it is to-day. Robert Smillie, the President of the Miners' Federation of Great Britain, definitely stated only recently that if the Government had introduced a Rill limiting the price of coal, adding to that a declaration that all surplus profits would be taken, the miners would not have asked any increase of wages whatever. I am not in any way justifying what I think is the horrible position which has arisen in South Wales, but let the House not forget that the Government have failed to take any steps whatever to let the people who are making these profits know that they ought not to make them, and that if they make them they are going to take them.
My hon. Friend, who wavered a great deal about this Bill said that the State had guaranteed higher dividends for railway shareholders and therefore colliery owners ought to be placed in the same favourable position. I think when the balance comes to be struck of colliery profits he and those who are associated with the trade will have no cause for regret, because we have heard to-day a chorus of approval from all colliery people that the President of the Board of Trade has treated them very well. The President of the Board of Trade has given the House certain figures of the in- 1252 creased cost of production, and he has also satisfied himself that the profits of the retail man have not been unreasonable. If his examination of the books of the retail trader are no more accurate than the figures he has given of the coal trade, his figures are of no value whatever. It is perfect nonsense to say that the price of coal has risen by anything like 3s. a ton on the average of the collieries of this country. If you split the amount in two you are getting nearer the truth. But under this Bill you are going to tell colliery owners that they are entitled to take an increased price of 4s. per ton, and you are going to invite them to do it. If the Bill is passed in its present form, I shall take the 4s. because if I let everyone have coal at a lower price than that it does not go to the benefit of the consumer, but goes straight into the pockets of the middleman.
I have found it extremely difficult to draw a Clause to rope in the middleman. The Attorney-General is a very astute1 lawyer and I will not believe it passes the wit of a man of his ability to draw us a watertight compartment Clause of this character. The President of the Board of Trade told me he would welcome a Clause but he cannot draw it. The difficulty is, of course, in dealing with the intermediate profits made by factors and coal merchants. Let me put this case: Assume that the coal merchant or factor buys coal at 15s. a ton; he sells it to a merchant, and if there is a hard winter there is nothing to prevent the factor or coal merchant selling the coal at 30s. or 40s. If there is a shortage of coal and people want it, they must pay the price for it. If the Attorney-General on behalf of the Government could draw a Clause providing that the-coal factor or merchant should make no greater profit per ton than he made in the twelve months preceding the War, that would place him in exactly the same position as you are going to place the coal owner under this Bill. The cost of delivering coal has very largely increased. I believe something like 1s. 6d. or 2s. a ton in London is the increased cost. Surely the ingenuity of man is able to overcome this drafting difficulty—once the main principle is agreed that the coal merchant is to charge no higher price than before the War. I do not know whether the Government will be able to deal with this question. We may have to look to another place to insert a provision of this kind to protect the consumer. Without that 1253 provision the Bill is worthless, because it will enable coal merchants, if the times are bad, to squeeze the poor, as was done last winter.
With regard to contracts, I cannot for the life of me see how any man has the impudence to say that merchants who have refrained from buying are shrewd men when that statement comes out of the mouth of a Member of the Government. For months and months they have delayed dealing with this question. It was essential that coal merchants should buy their coal, and owing to the neglect of the Government to deal with this question colliery owners have entered into contracts for the next twelve months, in many cases at prices 6s. to 8s. more than last year. Therefore what is the good, a fortnight after the contract season has been concluded, of the Government asking the House of Commons to pass a measure to limit the price of coal? Could anything be more ludicrous or foolish than for the President of the Board of Trade to say to these coal merchants, "You have not been shrewd, therefore you must stand the racket, and the public must pay the increased price." What is all this nonsense about the sacredness of contracts? We are living in times of great national danger, when no set of men can have the right to exploit the community at large, and these being the conditions under which we arc living, surely for the Government to say that these people who have bought their coal three or four weeks ago are to have immunity and are to be allowed to take their profits is to my mind a perfect scandal. But, worse still, the Government say to the coal owners, "We want to help the rate of exchange: charge our Allies what you like. We are not going to allow the provisions of this Bill to apply to Italy; we are not going to allow them to apply even to France, where nearly all the coal mines are in the hands of the enemy." The Government say, "Here we are in a great struggle, proud to be associated with the French, who have fought so extraordinarily gallantly and made such great sacrifices during the War. Their mines are in the hands of the enemy and they have to come to this country. Charge them what you like—rob her, provided you are able to raise the rate of exchange, and get all you can, even if it is £2 a ton," which was the price being charged in Cardiff a few weeks ago. For the Government to make a proposal of that kind is, to my mind, an outrage. If it is right that 1254 we should help ourselves, if this House of Commons is going to help the people of this country to have coal at a reasonable price, the obligation is put on us to see that our Allies are treated in the same way as we treat ourselves. In this matter we all ought to stand together, and it is absolutely wrong that there should be any differentiation whatever in favour of the people in this country as against our brave Allies the French, or the Italians, or even the Russians. This tax on profits is a matter which the Government really must deal with. If they will deal with it they will settle half the troubles arising out of this. Bill.
I wish to examine one or two of the Clauses of the Bill. This first Clause is not what I proposed to the Government. I should not have proposed taking similar quantities and similar conditions as last year as a basis for the new contracts of this year. The Bill provides that no coal shall be sold at a price exceeding by more than the standard amount per ton the price of the coal of the same description sold in similar quantities and under similar conditions at the pit mouth of the same coal mine. How are you going to say what is sold in similar quantities and under similar conditions means? You may have sold on the same day at the same colliery 1,000 tons of coal or 10,000 tons of coal, and the price varies in each case by sometimes a shilling a ton for the same quantity of coal. How are you going to take notice of the circumstances? How are you going to arrive at the similar circumstances under which in many cases a man buys coal at a favourable price? How will the colliery owner evade that? He will simply withhold selling that particular coal on a particular day and thereby defeat the object of the Government. In order to make the Clause water-tight the Government ought to entirely give up this question of taking coal of the same description and take the average price. I suggest that they should take these words: "No coal shall be sold or offered by the owner or on his behalf at a price exceeding the average prices realised by rail, inland water, or land sale, respectively, for coal of the same description at the pit mouth at the same coal mine in the twelve months preceding the War." If the Government take the average price of the coal realised then everyone in the trade will know at once where he stands. Take the average price of each quality of coal sold in the preceding year. You ought to 1255 have that disclosed so that every buyer knows at once what is the price at which he will be able to buy the coal, and the consumer likewise knows what the prices are.
I am going to move in Committee that the collieries shall send to the Board of Trade the average prices they have received for the different classes of coal in the twelve months preceding the War, and to those prices I presume the 4s. will be added. Then everyone in the trade will know exactly where he stands. But under the Bill as it is drawn no one will know what is the price from day to day, because the conditions are different; and how the conditions to-day can under any possible circumstances be similar to the conditions before the War I am utterly at a loss to understand or appreciate. I do hope the Government will see their way to accept that suggestion. I intend to move in Committee that all contracts entered into for deliveries from and after the passing of this Act shall be set aside. I do not want to repeat what I have said on the question of contracts further than saying that it seems to me that though the hon. Member for the City of London (Sir F. Banbury) may come down and talk to us about the sacredness of contracts, such a strong case has been made out that if the Government really desire to give to the poorer sections of the people of this country the benefit of this Bill they must in Committee meet us on these points. There are a great many of my Friends who have agreed to vote with me, because I shall carry this to a Division on the Committee stage if the Government does not meet us. If the Government say that they are not going to deal with these contracts as I suggest, then we must divide the House. If we are beaten by this Coalition Government, it will be only another of the foolish actions they have taken—perhaps I ought not to say this Coalition Government, but the Government that has been in power for the last twelve months—during the War.
I want to refer to the prices paid by the London County Council. I think the facts will astonish the House. The London County Council buy large quantities of coal under contract. Seeing what they have paid this year—of course, the prices include delivery and there has been an increase of probably 1s. 6d. for extra cartage to meet it—there has been an increase in Wales of 15s. 9d. per ton, in Warwickshire 8s. 3d., in Leicestershire 10s. 1256 —I sold thousands of tons of Leicestershire coal this year at 7s.—Durham 7s. 7d., Nottinghamshire 7s. 9d., Yorkshire and Derbyshire 13s. 9d. Are the Government going to allow these local bodies to pay these exhorbitant rates? They are forced to buy. The President of the Board of Trade says, "If they had been shrewd men they would not have bought." But there is only a limited quantity of coal, and they have to buy. The Government have been adopting the policy of wait and see, leaving everything until the last moment, during the War. These local authorities cannot wait and see. They were bound to get their coal when their contracts fell out, otherwise they might lose their coal supplies altogether. Is the Government going to say in Committee that we are going to allow these large prices to be charged by collieries who have made these contracts? Is the Government going to take up the attitude that those coal owners, who have made these contracts, are entitled to make all the money they can, and that the consumer is not to be considered? If they are going to take up that attitude well and good, but at any rate let us have that definition made clear. Are they going to say that the people who have entered into these contracts are entitled to have the benefit of them? These contracts were only made three weeks ago by reason of the fact that the Government last January hesitated and hesitated and hesitated, always frightened of moving, thinking that something would turn up to meet the difficulty, and when they find they are forced by public opinion to move, they come to the House two or three weeks after the contracts have been made and say, "You are not shrewd men if you bought, and therefore the consumer must pay." That is not business.
I am not blaming the hon. Member for Chelmsford (Mr. Pretyman), who has to reply for the Government. It is not his Bill; it is the result of an undertaking given some weeks ago that it would be introduced. The Board of Trade have lamentably failed in this matter, having lamentably failed to act when coal was selling at common prices. Though this Bill is necessary, I maintain that unless the material alterations I have suggested are made in the Bill the country need be under no delusion. Next winter they will still be fleeced and robbed at every turn by the middlemen, who are perhaps as big thieves as anyone else, as the coal owners—
§ Sir A. MARKHAM
Or as the shipowners. They all want to get their fingers in the pudding and they have done it very successfully. It is the duty of the Government in these times to prevent that being done. I should like my hon. Friend on the Committee stage to really help us in regard to these difficulties. I understand the President of the Board of Trade will not be here to-morrow.
§ The PARLIAMENTARY SECRETARY to the BOARD of TRADE (Mr. Pretyman)
Perhaps I may say that the Committee stage of this Bill is postponed beyond to-morrow. This may shorten the Debate a little now.
§ Sir J. HARMOOD-BANNER
I have listened attentively to the hon. Baronet opposite. While he is a colliery owner, I am bound to say that he does not represent anyone in the coal-owning industry except himself. I am quite prepared to agree with him on his proposals in regard to the middleman, but I think it is most important to repudiate his views about contracts as soon as possible. I would like to ask him whether he intends to break contracts which are at a loss as well as contracts which are at a profit, because in the coal trade there are two classes of contracts. There is a class of contract which has been recently made at present prices. In addition there is an enormous number of contracts which were made prior to the War in 1914, and some of them even prior to that date. Are those contracts to be broken? In my collieries we have got 300,000 tons of coal still to deliver on contracts made at that time at a very different price compared with the present price. Does the hon. Baronet suggest that the bad contracts for collieries shall be broken as well as the good contracts, or is his proposal to be limited only to those contracts made within the last month or two? If he proposes that we should start breaking contracts, and contracts which are of a cheap rate to the consumer, I do not know what the railway companies would say. The railway companies make these large contracts in advance, and this proposal would mean that the railway companies will have to pay 6s. or 7s. a ton more for their coal 1258 than under these contracts. Those who made contracts in 1914, and at the end of 1914 have got their coal at very cheap rates indeed, not only the railway companies, but the chemical companies, and every industry in the Kingdom Were able in contracts made from June to December, 1914, to get their coal at very cheap rates. These contracts are still running, and I understand that the hon. Baronet intends that these contracts shall be broken as well as those profitable contracts of which he has been making such a parade during the last few weeks. I hardly think that he can mean that all contracts are to be broken. I should like to have an answer from him. Does he mean all contracts are to be broken?
§ Sir A. MARKHAM
The hon. Member asks me a question: I would answer him in this way: The price of coal to the railway companies in Wales has been nearly doubled. This House and the country have got to pay that. I say that those contracts should be cancelled, and every other contract made in excess of the provisions provided for under this Bill.
§ Sir d. HARMOOD-BANNER
Then I understand that the contracts made by the London and North-Western Railway Company, the Lancashire and Yorkshire Railway Company, and other contracts made in Lancashire at cheap rates, are not to be broken, but only the South Wales contracts. Well, then, we understand what the hon. Baronet's proposal is. It is an extraordinary proposal that you should take contracts and tear them up when they are against you, but that you should adopt them when they are in your favour. He is a very excellent business man, but I do not think he would like his own contracts for coal, or his own proposals in regard to purchasing timber or anything else, about which he is so clever, to be torn up when they are against his principles.
§ Sir A. MARKHAM
May I tell the hon. Member that so far as the Lancashire and Yorkshire, the Great Central, and the Midland Railway Companies are concerned, the collieries with which I am associated booked very large orders for them last December when prices were very low, and we are quite prepared to carry those contracts out. We are not losing money on them, but we are making very substantial profits, even on the prices of last year.
§ Sir J. HARMOOD-BANNER
The hon. Baronet is extremely generous in giving away his property, but I hardly think that he can suggest that other people should follow him. I am thoroughly in agreement with him as regards the middlemen. There is no doubt whatever that this Bill is most invidious in placing upon the colliery owners a limitation of prices. It is most invidious and injurious in this way, that it places no limitation upon the price at which the middleman is able to sell. Some hon. Member suggested that the middlemen do not do a very large business, but those who know the facts will hardly accept that. There is an enormous amount of coal for bunkering purposes and shipment purposes and every sort of purpose sold through agents in this country. That coal undoubtedly in many cases, particularly when it comes to the poor, has a very onerous price placed upon it. I am a member of the Federated Body of Coal Owners. The hon. Baronet is not, because he never takes part with any of his fellows in the consideration of any question. He always acts on entirely independent lines. I am a member of the Federated Body of Coal Owners, and whilst I cannot say that they welcome this Bill, they arc quite prepared to fall in with it and to do their best to carry it out.
§ Sir J. HARMOOD-BANNER
I did not say you represented anyone except yourself. I think the House will agree with me in that. The Federated Coal Owners are quite willing to accept the Bill and to do their very best to carry it out and to make it work, but they do point out that the Bill is hardly fair to them where it treats them in a different way from the merchants who sell the coal. The merchant and the coal owner ought to be exactly on the same lines, and particularly for this reason, that a great many collieries have depots of their own and they carry on a trade in the big towns, at any rate up North. They fear that the result of this Bill will be that in those particular towns the merchants will be able to ask what price he likes, and the coal owner in his depot will not even be able to sell, so as to keep up the profit which pays his depreciation and rent and interest on capital, as he now carries on his business. Under this Bill he is limited to 4s. at the pit mouth, and then further when it goes through its various agencies he will make 1260 a loss on his business. Therefore the position as regards merchants and coal owners is most unfair, and I hope that when the Bill comes up for discussion the right hon. Gentleman in charge will consider the position in order that both merchants and coal owners shall be dealt with on similar lines.
All coal owners of whom I know cannot understand why drink and coal have been placed on a level. They are about the only two things which the Government can see their way to handle in order to dealt with these new and injurious principles of economics. Drink has been dealt with by the imposition of an extra tax, and now they say "we shall deal with coal." I cannot see why other trades cannot be dealt with, and why it should be limited to coal. A very distinguished shipowner in Liverpool, quite early in the War, said to me, "I do not understand what the Government is doing. I feel ashamed of the profits which I am making. If they would pay me 8 per cent, for my money and pay me depreciation in order that I might have my ships back in my possession at the end of the War in as good condition as they are in now, I should be only too glad that they would get them." Why do they not touch the shipowners? Drink and coal are the only two things which they have touched. I do not know why they have selected these trades. If they have taken up this principle I trust that this House will not limit it to these trades but will say that this is only an instalment, and that every trade must be treated alike. In reference to this Bill I would like to consider Clause 1 for a moment. The consumer is to pay 4s. a ton more than he is now paying, but if you look into the Clause you will find that it does not carry that out. It is quite possible under that Clause to give one part of the Kingdom a difference of Is. in the price which it will get as compared with another part of the Kingdom. The Bill wants readjustment in order that all parts should be treated alike. There are other important points which require elucidation and putting in proper form.
The coal owners cannot welcome this Bill because they consider it a hardship that they should be treated separately from other trades in the Kingdom, but they are quite willing to be as patriotic as the miners themselves who have done so much for their country during the War, and they are quite willing that coal should not go beyond a proper price. 1261 But they do say that there is an enormous amount of nonsense talked about the profit of coal owners. I know that in many cases up to the 31st December last collieries did not produce any profit at all in very large districts of the country. I have seen my own accounts, and the accounts of many other collieries for that period. I have also seen accounts to the 30th of June this year, and in the case of one colliery in which I am interested, the price at which nearly 800,000 tons of coal was sold at the pit mouth was 9s. 11d. That is not such an extraordinary price. The net profit on the whole year—for the loss up to December has been made up— is a difference of 8d. per ton. Eightpence per ton represents what has to be provided for depreciation and interest on capital. A question which this House ought to consider is that of mining royalties. Whether we take the coal out of the land or not we have got to pay our royalty. With the men going away our output is considerably less. It is 80,000 tons less than it was last year, and we have still to pay out landlords their minimum royalty, even if we do not get the coal. The royalty very often amounts to £8,000 or £10,000 a year, which they have to take out of profits. I think that the figures show that it is not altogether the coal proprietor who has been making the profit. He has been getting a little bit of his own for the last twelve months, but the House would find, if it could get an opportunity of investigating the matter, that the extra profits have been going almost exclusively to the middleman. This Bill requires a great deal of amendment, and I trust that it will receive it in order that it may be made as perfect a measure as possible.
§ Sir J. WALTON
May I be allowed to say that if the President of the Board of Trade had made his speech before I spoke it certainly would have modified my attitude on this Bill. I still think that, in the form in which it is before the House, it will be ineffective for its purpose, but in the hope that it may be amended in Committee, I beg leave to withdraw my Amendment with the consent of my seconder.
§ Amendment, by leave, withdrawn.
§ Main Question again proposed.
§ Mr. PRETYMAN
I hope that the House will allow us to get the Second Heading now, and defer further debate on the points which have been raised until 1262 we come to the Committee stage, which we do not propose to take to-morrow. It will be taken as soon as possible. I cannot say exactly when, but it will not be to-morrow. There should be some time for consideration of Amendments after they are put on the Paper, and I hope time will be given to my right hon. Friend the President of the Board of Trade to get back and be present when the Committee stage is taken. The Debate has been very interesting. Every hon. Member who has spoken has a more actual knowledge of the conditions of the coal trade than I have myself. I must, therefore, ask for the indulgence of those hon. Gentlemen for the remarks which I propose to make, but I feel that there is some compensation in the fact that this Bill is not a Bill for the coal trade alone. It is not brought forward on the ground that the coal trade is a trade which requires interference with under ordinary conditions. This Bill is brought forward on purely national grounds, and I very much regret that my right hon. Friend the Member for the Ash-ford Division (Mr. Laurence Hardy) should have used the expression "penal legislation." There is under this Bill no penal legislation whatever, and there is no accusation made against the coal owners that they are different from people producing other commodities. I hope that my hon. Friend who has just spoken will thoroughly understand that.
The only reason why this Bill deals with the coal trade, and with the coal trade only, is that the conditions in that trade are different from those in any other trade. It is not that there is any difference in the character of those who carry it on, or in the moral nature of the trade. It is not that the trade is a trade which is bad for the community. On the contrary, I suppose that if you were to pick out a trade which is vital to the community and which confers benefit on the community, you would pick out the coal trade. Therefore it would be ludicrous for the Government to pick out the coal trade for penal legislation or to say that the coal trade is carried on to the injury of the community. But there is this difference in the case of the coal trade. The whole of the coal trade is produced in this country. It is a vital necessity to every industry in this country, and as well as to every private individual, that they should be able to get a sufficient supply of coal at reasonable prices. My hon. Friend the Member for Everton suggested that this, measure should be applied to shipowners, 1263 that shipowners had made large profits. That would have been an admirable criticism if we had been discussing here and now the question of taxation of all profits, which possibly we shall be discussing at some future time. Then I think it would be unanswerable to say. "Why should you tax the coal owners' profits, and not tax the shipowners' profits?" But this Bill is not brought forward to tax the coal owner. It is a trade measure. It is not a finance measure. It is simply brought forward with the object of getting a basis of price, so that the price to the consumer, whether he be a manufacturer or private consumer, is not raised to breaking point.
§ Mr. PRETYMAN
The question of freights is a totally different point. There is no reason for treating freights like coal in this particular. You have got to look at all the surrounding conditions. Coal you can deal with as it is dealt with under this Bill. Take this comparison which is raised here and now, from the national point of view, between coal and freights. If you were to proceed to treat freights as you are now treating coal, the consequence would be that you would deprive this country of its greatest asset in regard to financial exchange. The greatest asset which we have is that the British shipping trade is getting its freights, and that those freights are a set off against the enormous excess of our imports over our exports, and if you were to proceed to legislate for freights only—home freights for the coastwise trade—you would drive the shipping out of the coastwise trade altogether. I think that I have said enough to show that this is a very difficult question, and that there would be the probability of doing more harm than good by adopting the suggestion made. The war profits of shipowners or of anybody else can be dealt with by taxation in regard to the merely financial point, but this is not a question of finance. This is merely a question of trying to regulate the price to the consumer in this country.
I quite admit that in dealing with this matter we are entering upon most difficult ground, and to my mind the only justification for entering upon this ground at all is that we are at war. There is no other justification for it. When we are at war 1264 the conditions are so entirely different from peace conditions that we have to perform a very difficult mental operation, and that, so far as legislation during war is concerned, we have very often to reverse principles applicable in peace time. Many of the criticisms which have been directed against this Bill would be unanswerable if it were a peace measure, and if it were a precedent which would lead us in this or that direction. Nothing done in war is a precedent for what would be done in peace, and we are not now setting any precedent for what might be done in peace. The only justification which can be urged for this Bill is that it is an emergency measure. It is a war measure. Nobody will suggest for an instant that it is perfect in the sense of its going to carry out the object of ensuring to the consumer in war conditions coal at no higher price than he would get it in peace time. You cannot do that. As my right hon. Friend the President of the Board of Trade pointed out, this Bill is really intended more as an insurance against panic prices in future than anything else, and I think it must be judged by that factor. It is not such an ambitious Bill as the hon. Member for Mansfield suggests as covering the whole ground. I think that the difficulties that would then be created would be far greater than any good result that could be obtained. The criticisms of the Bill have concentrated themselves quite naturally, and I think the Board of Trade understood that would be the case, upon two points. The first point is that it does not go far enough and that it will not ensure any reasonable price to the consumer because it does not deal with the distributing trade as well as the producing trade. The second point is that it only deals with prices and not in any way with contracts. These are the two main points. As regards the first point, I believe that a very great advantage will be obtained in dealing, by any means whatever, with the distributor if you have got a basis price. This Bill deals with the question of a reasonably fair basis price at the pit at which coal can be obtained, either direct by the consumer or by the coal merchant who is going to distribute to the consumers throughout the country. I beg the House to judge the Bill by that standard, and not by the artificial standard that this is to be a millennium in coal prices which they would like to see brought about.
1265 I think almost every Member who has spoken has done so with particular knowledge of the coal trade in a particular district. The hon. Member for Mansfield spoke with very great knowledge of one particular coal trade. I have not got that knowledge of any coal trade, but I do know enough to say without fear of contradiction that it is known to every business man in the country that the particular coal-field of which the hon. Baronet has knowledge is a new coal-field, which has seams in favourable situations, with all the modern equipments which science has devised, and which gives it the greater advantage in competing with coal districts under conditions of older date and less favourable to the producer. The Board of Trade has to look at this question from the point of view of the whole industry from one end of the country to the other, and, therefore, although the hon. Member for Mansfield has a very much greater knowledge of the coal conditions than I have, I suggest to him that the Board of Trade's most careful examination and calculation of the figures of production and the prices from one end of the country to the other is really more valuable than is the hon. Gentleman's expert knowledge, which is rather more local in character. If the House judges the Bill by that standard, namely, that it is only intended to provide a basis price of coal at the pit mouth, and does not profess to go further than that, then I think the Bill may be considered worthy of acceptance, and perhaps the House will be good enough to give the Bill a Second Reading.
But I think, also, that the House would make a mistake if they attempt in Committee to carry the Bill too far. It must be remembered that we are embarking on very troubled and difficult waters, upon which we should not embark at all in peace time. The question is, How far are you justified in war time in departing from principles which govern legislation in peace time in order to obtain a national object? I suggest that if you can succeed by this Bill in establishing a basis price at the pit mouth, you are going to have the minimum of disturbance of industry, and the minimum of difficulty in discussing and considering in this House all the innumerable local conditions which govern the distributing of coal from one end of the country to the other; you are confining the area of this Bill, and I believe that if you carry the area of legislation proposed in this Bill beyond the pit mouth and take it into the trade as a whole, you will really 1266 do more injuryto—because of the complications and the difficulties that will be set up—than you will advantage the consumer. What my right hon. Friend the President of the Board of Trade suggested was this, namely, that arrangements have already been made with the London coal merchants, whereby their prices are limited to a figure directly dependent on the price at the pit-head and the cost of railway carriage; so that local authorities may make similar arrangements from one end of the country to the other with coal merchants. I believe it will make an enormous difference, both from the moral and financial point of view, and the fact that any local authority or any private committee may set itself to make such an arrangement as that with the coal merchants of any district, cannot be met with the reply that we have not the information as to what extent the prices are going to be raised against us. When such a local authority or committee can say to the coal merchant, "You have got the basis price fixed by the Bill; we all know the carriage from the colliery district to this locality where we are living, and therefore we have very good knowledge of what is being paid for the production and the distribution of the coal," in that way each locality will be able to do for itself what the President of the Board of Trade has been able to do in London, and I believe it can be done in that way, and it would be a mistake for the State to step in.
With regard to the question of contracts, the President of the Board of Trade strongly impressed on the House that to go back upon them would create many cases of inequality and hardship in the distributing trade. If we were to take the other course, the delivery basis instead of the contract basis, and were to say that all coal from a stated date after the passing of the Bill shall be sold at certain prices, I think it would be found in that case that even greater hardships and difficulties would be caused than any which could arise from this proposal. Whatever course is adopted, it is bound to create some difficulties and hardships. Of course, when you legislate in war time you have got to legislate in the national interest with the minimum hardship to the individual. This has been most carefully considered by my right hon. Friend. He is perfectly aware of the hardships which are created by allowing existing contracts to stand, but he has come to the conclusion that even greater hardships and difficulties would be created by breaking the 1267 contracts which now exist. Therefore his judgment, on the whole, is that it is better to leave the Bill as it stands. That is a matter, of course, which can be debated in Committee. Amendments no doubt will be submitted, and doubtless my right hon. Friend will be here to listen to them. I know that he will welcome debate on this subject, and will be perfectly prepared to give every weight and consideration to what has been said here to-day, and to what may be said when we arrive at the Committee stage.
The point which I am trying to impress upon the House on the Second Reading is, that it is impossible to make a measure of this kind such as will meet with universal approval because it will do nothing but good, and will completely carry out what every Member of the House desires to see effected. I do not think that either of those things is possible. The Bill is not as ambitious as that. But I do hope that the House will look at it as an honest attempt to deal with this question. The criticism has been made, that if we cannot deal with existing contracts it is the duty of the Government to prevent any rise in prices at all. I do not think it is possible, nor is it the duty of any Government to prevent the rise of prices; I do not think it would be effective; I think that the remedy would be far worse than the disease. What the duty of the Government is is to take steps in time to prevent panic prices, which would be a disaster to the community. Here we have a Bill brought forward in the month of July, and although it may not do all we want or would like to see done to cover the period past and present, it will and must prevent panic prices, and measured by that standard, I think it will be found to be well worthy the consideration of the House.
§ Sir A. MARKHAM
Will it be left to the sense of the House whether existing contracts should be included?
§ Mr. PRETYMAN
Certainly not. I do not think it is the duty of the Government to leave a question of that kind to the House. It is the duty of the Government to look most carefully into all the facts and figures, to see what course will be productive of the least injury, and they would seek the advice of the House in that sense. The House will have to come to a decision, and it is entitled to have the advice of the Board of Trade and of the Government on such an important point, which should not 1268 be left to the unguided judgment of Members. The hon. Member for Kildare asked that Ireland should be exempt. I will convey that to my right hon. Friend for his consideration before the Committee stage. I do not know whether all hon. Members who represent Ireland hold that point of view, or the Irish coal consumer as well as the Irish coal producer, but I suppose, at any rate, that we shall have some information upon that when we arrive at the Committee stage. The hon. Member for Mansfield suggested some alteration in the form of Clause 1. His suggestion will have very careful consideration, but it is obviously a point for Committee, and not for Second Reading. I think I have answered generally the points that have been raised in the Debate, and I hope we may now be allowed to get the Second Reading of this Bill—as there are several other Bills to come on—and we will be able to discuss the further points when we arrive at the Committee stage.
§ Sir A. MOND
I would not have intervened in this Debate had it not been for some of the remarks made by the hon. Gentleman on the very important question of the Government's intention of dealing or not dealing with contracts already existing. I would like the right hon. Gentleman to consider one point that has already been referred to. Although this Bill limits the price of coal, there is nothing in the Bill which compels anybody either to raise any coal or to sell any coal. That may seem an academic point, but it is realy important from a practical point of view. There are plenty of manufacturers in the last six months who have had contracts with colliery proprietors for the sale of coal at certain prices, and who, on many occasions, have not been able to get the contract delivered because the coal has been diverted to other customers who have been willing to pay higher prices. I regret to say that in the Midlands, as one hon. Member has already pointed out, that has been a very common practice. The manufacturer may be told that he has his legal remedy, but it is no use to a manufacturer who has to keep his works going to bring a law suit while in the meantime his coal supply is stopped. As the Bill stands now, you have also a large number of contracts running at better prices than you are going to allow in the future. The result of that will be a tendency, and this matter has been expressed to me by several large colliery proprietors, 1269 to take care that the coal goes to the people who are not paying the minimum prices but the higher prices they have already contracted for. The result is that you will do a great deal more harm by your Bill to people who have not contracted than you will do good to anybody. The people who have not contracted will be put in the position of not having to pay more than a minimum amount, while the people who have contracted at higher prices will get the full coal supply while the other people will experience difficulty, and yet this Bill is supposed to be a great protection to the consumer.
One of the dangers I notice in these discussions is that the Government seem to be obsessed with the question of London households and. the London coal margin. That is a very small part of the problem of coal in this country. The important question is the millions of tons of slack and industrial coal which we want to keep the factories running in order to supply the Government with the articles they require. It is not a question of whether the London coal merchants or the colliery proprietors get a shilling more or less. Then I do not think there is sufficient recognition of another very important question, to which my notice has been directed in South Wales, and that is as to not limiting the export price of coal. What would be the result of that? The man who is exporting coal from South Wales or any other part will be in this position. He will be able to get very big prices from the export market and very small prices as far as the Home trade is concerned. The result will be that he will have a natural tendency to ship coal abroad and keep the consumer at his door short.
§ Mr. PRETYMAN
I do not know if the right hon. Gentleman was here when reference was made to the Licensing Committee which governs that matter. Their particular function is not to allow any coal to be exported unless there is sufficient coal in the country.
§ Sir A. MOND
The theory may be to do so directly, but in practice it is very difficult. The Licensing Committee can make up its mind, say, how much coal is required in Swansea—
§ Sir A. MARKHAM
Perhaps the hon. Baronet will allow me to inform him that since the Licensing Committee was set up 1270 the price of coal for railway companies, for the London and North Western Railway Company, has just doubled from what it was this time last year.
§ Sir A. MOND
Why could not something be introduced into the Bill to make this point more obvious to people who are dealing with coal. I know that no coal is supposed to go abroad without the consent of the Licensing Committee, and that the Committee is to see that we are not short and that industry does not stop. But there is a great difference between having no coal and being inconvenienced.
§ Sir C. CORY
The Licensing Committee consider every cargo for every market. They have refused licences for numbers of cargoes in South Wales and other parts of the country, and the consequence is that prices are forced down many shillings per ton, and some of the collieries have been stopped because they could not get wagons and could not get rid of the coal.
§ Sir A. MOND
The Parliamentary Secretary assures me that if we leave matters to the Licensing Committee we shall have plenty of coal, and an hon. Baronet tells me that the Licensing Committee seem to be diminishing the supply of coal. I shall leave the two hon. Gentlemen to reconcile those views. The point which I have mentioned has been brought to my notice, and I am not quite convinced that this is the best method of dealing with the matter; perhaps it had better be dealt with in Committee. I do hope we shall not have an absolute non possumus on some of these important points, such, for instance, as the question of contract. Take the position on that matter between different consumers. Somebody, say, has quite legitimately made a contract, a pretty high contract, six weeks ago, not knowing that this Bill would be introduced. Ho is to be held to that contract, while somebody who has let things slip and has not thought about the matter is to have the great advantage of cheaper coal, which may enable him to undercut the other man in some respects. That seems to me to be a very unfair proposition. It is not a question of shrewdness. It was quite impossible for the shrewdest man to guess when the Government would introduce this Bill. Shrewd people would have imagined that this Bill would have been introduced many months ago, and that therefore it is not fair to come down and say, "You should have guessed that this Bill was going to be introduced now." I cannot see why it would be unfair to cancel contracts made, 1271 say, within the last three months. After all it is an accidental circumstance, probably due to the enormous work of the Government, that this Bill was not passed several months ago. It is more or less a question of accident. Why should you only limit it to a given date and not go back, I will not say for years, but for a reasonable number of months, so as to put people on a more equitable footing? I am certain that that will have to be done, and that that will lead to less difficulty and unfairness than to leave the Bill in the condition in which it is now.
§ Mr. OUTHWAITE
The Parliamentary Secretary said that this Bill was for the purpose of preventing panic prices in the future. If that is so, there is no object in the limitation or abrogation of contracts. It is not what people are looking for. They are looking for some measure which will relieve them of present high prices. I know as far as the district I have the honour to represent (Hanley) is concerned that they have been looking for many months for a reduction of the high and extortionate prices that were going to be demanded of them when new contracts had to be made. Those contracts have been made in the past three weeks, and a very increased price, amounting to as much as 6s. per ton, has been demanded. As the hon. Baronet who has just spoken pointed out, this is much more than a question of London households; is is a matter of manufacturers' supplies. In the pottery trade, for instance, the cost of coal enters largely into the cost of production. That particular trade has had great difficulty in carrying on since the War, but by working three days per week they have managed to keep men and women in employment. This rise in the price of coal has been disastrous. I have had from the municipality protest after protest against the suggestion that these contracts should not be broken. I hope the hon. Gentleman will convey to the President of the Board of Trade the very strong opinion which I am sure exists, not only among some Members of this House but throughout the country, that these contracts should not be respected. There will be considerable bitterness of feeling, because in some cases coal sellers have refused to allow men who have been in the habit of getting contracts from them to wait for a few weeks until they saw what this Bill would do. I have had a letter to-day from a man in the home 1272 counties who has been accustomed to get 200,000 tons a year. He states that he has been to the dealers from whom he has bought before, and stated that he wished to wait awhile, but they said, "Now is the time; you must make your contracts." This man, therefore, writes asking that Parliament should enable such contracts to be broken. It is not merely a question of the price paid by London householders; it is a question in many districts, in my own in particular, of saving the manufacturing interest at a time of great distress and hardship.
§ Question put, and agreed to.
§ Bill read a second time, and committed to a Committee of the Whole House.—[Mr. Walter Rea.]