§ 8.0 p.m.
§ Mr. Manningham-Buller (Northants, South)
I beg to move to leave out "£133,511,600" and insert "£133,511,500."
I do this to draw attention to Item Z in the Supplementary Estimate for the Ministry of Agriculture and Fisheries in order to obtain an explanation from the Minister of Agriculture with regard to some rather curious and astonishing figures revealed in the Estimate. The House will see that on page 53 of the Supplementary Estimates, under the heading "Z.—Appropriations in Aid" there is given a list of the anticipated deficiencies. Under the heading "Gang labour" one sees that the anticipated 131 deficiency is £1,370,000. Under the heading "Machinery operations (agricultural)" the anticipated deficiency is £1,200,000. It is with regard to these figures that I shall be asking the right hon. Gentleman to give us a very clear explanation.
In the original estimate for 1949–50 the anticipated deficiency for gang labour was £2,900,000. That estimate was revised after discussion with the Treasury and reduced to £2,700,000. Presumably the Treasury were called in to try and make sure that a close estimate was arrived at. The effect of this Supplementary Estimate will be to add another £1,370,000 to that £2,700,000, making a total deficiency on gang labour of £4,070,000—an increase of just over 50 per cent. above the figure contained in the estimate which was revised after discussion with the Treasury. I hope the right hon. Gentleman will not dissent from those figures and that calculation, both of which are based upon the information contained in the evidence submitted by his Ministry to the Select Committee on Estimates in the last Parliament. He will find the figures on which I base that calculation on page 290 of that Committee's report.
With regard to the machinery operations, there again the original estimate of the deficiency for 1949–50 was £650,000. That was revised and reduced by the Treasury to a figure of £500,000. It is that figure of £500,000 which has to be contrasted with the figure in the Supplementary Estimate for a further deficiency of £1,200,000, meaning, if I understand the figures correctly, which I think I do, that instead of the loss on machinery operations on agricultural service being £500,000 it is now anticipated it will be £1,700,000, an increase of 240 per cent. Looking at it in another way, the estimate prepared by the Ministry, and reviewed after discussion with the Treasury, is 240 per cent. out. It may be, but we hope it is not the case, that the right hon. Gentleman has been seeking to model himself upon and to follow the evil example set by his colleague the Minister of Health. At least one can say that in view of these original estimates, as revised with the Treasury, these great increases in the anticipated deficiencies under these two heads do call strongly for an explanation.
132 While considering these figures, I have been thinking what are the possible causes for these vast increases upon the original estimates. Perhaps I could say that they might come from one of three possible causes and possibly, of course, a combination of one or more of them. It might be that the anticipated deficiency in respect of gang labour and machinery operations is because the receipts from the farmers for the hire of both gang labour and machinery are less than anticipated. That might be one cause. Another might be because large amounts are outstanding and due from farmers which have not as yet been collected.
The third possible cause might be that there has been some error, and it would me some error in the accountancy within the Ministry. For instance, there may have been some confusion between cash entries and cross entries in relation to which no cash passes. I cannot think of any other possible cause. The more we consider those possible causes the more unlikely it appears to me that they really afford any explanation for these figures in the Supplementary Estimates.
I should like to say a word or two about these possible causes. No doubt, the right hon. Gentleman will tell us whether it is the case that the receipts from farmers in respect of gang labour are so considerably less than was anticipated. That might occur, of course, if there has been a substantial reduction in the gang labour service. No doubt, he will tell us whether that has occurred or not. He will, no doubt, recollect that the Select Committee recommended that notice should be given of the progressive reduction of gang labour service, with the object of ending its existence in 1952, and the Departmental replies to that report did not indicate dissent from that as a general proposition.
I should, indeed, be surprised to hear that there had been such a swift reduction in the gang labour service, following upon publication of the Select Committee's Report, as to account for this vast reduction in the receipts from the gang labour service.
Another possible reason for reduced receipts from farmers in respect of gang labour would be that the farmers had ceased to make use of the existing service to any great degree. The Select Committee pointed out that in 1947–48 the 133 gang labour service was unemployed for approximately a third of the year. But then the Ministry of Agriculture, in their Memorandum, published in Annex 15 to the Select Committee's Report, said this:In general, Committees have been instructed to keep their labour operations continuously under review in the interests of economy and efficiency. They are to examine their holdings of agricultural workers in the light of current needs, to dispense with the services of unsatisfactory workers, and to examine their arrangements for the distribution of labour to avoid unnecessary journeys and loss of working time. A system of fuller records of labour operations is being kept, to facilitate the investigation of lost time, and the result come to the Ministry for scrutiny.In the light of that evidence, surely it would be very remarkable indeed if this deficiency were in any considerable part due to the maintenance of a gang labour force much larger than is required by the farmers, and due to the gang labour force not being used by the farmers.
The Select Committee did warn the right hon. Gentleman that increased charges for the gang labour service might result in less employment of the gang labour service, and I should be interested to know whether that warning has, in fact, resulted in the increased charges not being such as to deter use of the service. Having regard, however, to the Memorandum from which I have just quoted, and the institution of this closer scrutiny, I must say I cannot feel that the cause for this greater deficiency than was anticipated is the fact that farmers are making less use than was anticipated of the gang labour service.
Let me now turn to machinery operations. Is it the case that there are reduced receipts, much less than was anticipated, from the farmers for machinery hiring? I understood after the Report of the Select Committee was published that it was likely that the machinery service would be considerably reduced and the surplus machinery sold. Of course, if it is reduced there will be reduced receipts from farmers. But then again, those reduced receipts would be off-set, at least to some extent, and possibly exceeded, by the proceeds of the sale of surplus machinery. I must say, I find it indeed difficult to come to the conclusion that reduced receipts from farmers, taking into account the proceeds of the sale of machinery, could result in a deficiency 240 per cent. above the anticipated defi- 134 ciency after the Treasury had gone into the figures.
It is for those reasons that I find it very hard indeed to come to the conclusion that the cause of this vastly increased deficiency is due primarily to a drop in receipts from farmers. Is it, then, due to large amounts being outstanding from farmers and not collected at the present time? The evidence of the Ministry that the Select Committee heard was that the Ministry had undertaken a review of the financial losses of the county committees and had assumed a stricter control. It is again difficult to believe that as a result of a stricter control such large amounts should be outstanding as to account for a deficiency of over £2½ million.
Is the cause an error in accountancy? It is difficult to see how that could have happened, or if it happened what possible excuse there could be. In its Report the Select Committee did draw attention to the fact that the accounts of each county were unco-ordinated and confused in form, and to the fact that expenditure on gang labour and on the machinery services was sometimes debited to the gang labour account or to the machinery account, and in other cases to the lands in possession.
So, as it appeared clearly from that Report, it was difficult, if not impossible, to ascertain the precise position with regard to each service; difficult, if not impossible, to ascertain to what extent the lands in possession were being worked at a loss; and difficult, if not impossible, to determine precisely what amount really was being spent upon the gang labour service. But those difficulties in relation to those accounts should not affect the cash receipts.
Surely the county committees should know—I am sure they do know—and should have a record of what they receive by way of cash. Surely the Ministry themselves must know what is spent in cash by the agricultural committees. They also should know the total of cash received, although they may not be able to split it up perfectly accurately under the respective headings. I think this is borne out by the evidence given before the Select Committee. In paragraph 6 on page 306 of the Report, dealing with lands in possession, it is said:The figures in the Estimates show an excess of receipts over expenditure. The figures do 135 not, however, provide an accurate picture, since they do not include internal payments between one Committee department and another such as the use of gang labour on lands in hand, the hire of Committee machinery, etc. These items were estimated for under their relative sub-heads. If these different items are taken into account, the estimated expenditure on lands in possession would exceed the estimated receipts.That passage makes it quite clear that the internal accountancy was not all that was required to give a true picture with regard to lands in possession; but it does not in the least suggest that the accounts did not reveal a true picture with regard to the total cash expended and the total cash received by the county committees and by the Ministry. Indeed, two answers given by the right hon. Gentleman's Director of Accounts really, I think, establishes the position. That gentleman was asked, in Question 474:In paragraph six reference is made to some contribution which is not given in detail. 'Have we any information as to what the size of that contribution is?'The answer was:I think that sort of thing will be reflected in the figures which I have promised earlier this morning to submit to the sub-Committee.I ask the right hon. Gentleman to mark these words:The income and expenditure account figures do include all these internal transfers, although the Ministry cash figures do not.We are dealing here in the Supplementary Estimates entirely with cash figures, and it is an explanation of the deficiency in these cash figures that we require from the right hon. Gentleman. The next question goes on:In other words, can we take it that, if gang labour is provided and if machinery is hired to the land that is being farmed in this way, a charge is being made for it?The answer that was given is this:A charge is certainly being made, but we did agree in the quite early days of the war with the Treasury Officer of Accounts that in the Ministry accounts we would not give effect to these very voluminous transfers. Their effect would be to inflate both sides of the Exchquer account by several million pounds. They are given effect to in the books of the committees, and they will be reflected in the income and expenditure account. Therefore, gang labour or machinery hired by land in possession will be shown as expenditure on lands in possession and as income for the other Departments.I have quoted these passages to show that the confusion and unco-ordinated accounts to which attention was drawn 136 relate to the internal accounts of the county committees and do not relate to the cash accounts. In regard to the cash accounts, it is interesting to observe that the same gentleman, the Director of Finance of the Ministry of Agriculture, stated that the Ministry got cash accounts from the county committees monthly. If cash accounts were being received monthly, what is the explanation for the deficiency of over £2½ million in cash receipts? That could not appear overnight unless something very surprising happened. It should have been perceptible months ago that the cash receipts were less than had been anticipated, and if some items had been included as cash receipts which were not cash receipts. No hint or indication of any such state of affairs was given to the Select Committee.
This particular Supplementary Estimate indicates to some extent that the picture presented to that Select Committee was more favourable than the reality so far as finance was concerned. I am quite sure the right hon. Gentleman will agree with me that it would be very wrong if Select Committees of this House, and the Estimates Committee in particular, were misled as to the financial position. Therefore, we desire to take this opportunity to invite the right hon. Gentleman to give a clear and full explanation of these deficiencies; indeed, we feel that it is really necessary that he should do so.
I want to say a word or two about one other entry under the same Subhead of the Estimates—Lands in possession, including farming operations—anticipated surplus.An anticipated surplus looks much nicer than an anticipated deficiency, but how does this anticipated surplus come about? It is not very good estimating either way if the estimate of what the surplus will be is £1 million out and the estimate of what the deficiency will be is over £2½ million out. How does this arise? Is it because certain crops held by the county committees were sold after the end of the financial year and come, therefore, into this year? Were these crops primarily potatoes, and were these potatoes sold at prices subsidised by the Ministry of Food? I should be interested if the right hon. Gentleman would answer these three questions.
137 I will conclude by reminding the right hon. Gentleman that his Ministry stated they were glad to have an opportunity of making it clear that their aim was to make these gang labour services and machinery services completely self-supporting as soon as possible. The right hon. Gentleman said the same thing in the Debate in the House on 8th December. With regard to the gang labour services, he said:I am anxious that all avoidable losses should be avoided, and our aim has been to reduce the net loss to a minimum.In regard to the machinery services, he said:Machinery surpluses are being steadily reduced, and every possible step is being taken to improve efficiency and economy."—[OFFICIAL REPORT, 8th December, 1949; Vol. 470, c. 2197–2200.]We now have the Supplementary Estimates before us, showing anticipated deficiencies both for gang labour and for machinery totalling £2,570,000. I regret that I cannot congratulate the right hon. Gentleman at present upon the result that so far has attended his efforts as indicated in that Debate. I hope that the right hon. Gentleman will now give us an explanation for these extremely curious and very disappointing figures.
§ 8.28 p.m.
The Minister of Agriculture (Mr. Thomas Williams)
The hon. and learned Member for Northants, South (Mr. Manningham-Buller) said in the course of his remarks, after making one or two quotations, that he finds it difficult to reach a conclusion. No one will evince surprise that the hon. and learned Member finds it difficult to reach a conclusion. It would be inconsistent with his profession to reach conclusions too early. I think that this is perhaps one of those occasions when a conclusion was not sought for very keenly.
The hon. and learned Member has quoted from the Minutes of the Select Committee. By this time I should have thought that it was unnecessary for him to quote them and that he would have had them off by heart in view of the number of times he has quoted the evidence of that Committee.
§ Mr. Manningham-Buller
Will the right hon. Gentleman give one occasion on which I have referred to the evidence of that Committee in the House?
§ Mr. Manningham-Buller
The right hon. Gentleman treats it as a laughing matter. May I tell him that on no occasion have I said anything in the House on the Report of this Select Committee? The right hon. Gentleman is making this accusation, although he is doing it jovially, and saying something that is entirely incorrect.
And so do I. The hon and learned Member has been speaking for some 15 minutes asking questions about which he appears to know nothing at all, when he knows just as much about the situation as I do myself. If the hon. and learned Gentleman ties me down to truth let us both be truthful and we shall know where we stand.
This is a very serious proposition and I readily appreciate it. Looking at page 53 there is ample justification for Members of the Opposition to ask appropriate questions as to what has brought about this deficiency. I make no complaints about it. My reference to the Select Committee was justified in the circumstances because we had not long since a full day's Debate on the Estimates and their content, when many questions were put and many answers given. And I think the Department for which am responsible at the moment received far less than justice from hon. Members on the Opposition side of the House on the matter of the content of this particular Select Committee Report.
The first thing to note about the figures on page 53 of this Supplementary Estimate is that they represent reductions in receipts and not additions to costs. Therefore, losses are not in question. The major part of the deficiency is due to the fact that the labour and machinery departments are not reimbursed in cash for services rendered to other departments of the Committee such as lands in possession. In the original Estimate credit was wrongly taken—it is admitted at once—under sub-head Z for the value of such services. Their value will, of course, be taken into account in the 139 trading accounts of the Committee relating to such subjects as lands in possession, but should not have been taken into account for cash estimate purposes.
This sum does not represent additional losses, if that be the right word—I hope the hon. and learned Gentleman will listen to the reply—but is on gang labour and machinery services. It is true to say that if these cash payments had been made, there would have been a deficiency of the same figure on the Committee's account. That does not imply a loss at all, or any addition to the figure previously mentioned by the hon. and learned Gentleman, but the proper document—
§ Mr. Turton (Thirsk and Malton)
Would the right hon. Gentleman make it clear if this mistake occurred only in this year 1949–50 and not in the previous years 1947–48 and 1948–49?
As the hon. Gentleman knows, accounts for executive committees have only been built up over the last two or three years, but accounts this year are identical with what they were in previous years. There is no change whatsoever. The proper—
§ Mr. Turton
That is not quite a clear:answer. The Minister is addressing him-self to a mistake of £21 million, and I am asking this question—did that same accounting system prevail in the previous accounting year, 1948–49?
Yes, if the hon. and learned Gentleman likes, but that does not turn a paper figure into a loss.
§ Mr. Manningham-Buller
The right hon. Gentleman uses the word "loss." I used it perhaps inaccurately, but it is a loss to the country of £2½ million, is it not?
The hon. and learned Gentleman is still not reaching the right conclusion. It is not an extra cost to the State at all. I have said that if one department of a county executive committee paid another department in cash for services rendered, then the deficiency in receipts will not occur, but the committee 140 itself would have an all-over deficit of the same amount. The proper document on which to consider the result of farming operations will be the trading account which will be prepared and published after the end of the financial year. Quite simply, therefore, but unfortunately, the original Estimate of appropriations-in-aid was set too high and the estimate for food production services was set too low. That is always possible when the Estimates have to be prepared 18 months in advance.
What has been said so far deals with approximately £2 million out of the £2,570,000. The balance of £570,000 is made up of £270,000 for gang labour and £300,000 for machinery operations. These are reductions in receipts and not increases in expenditure. They are due to the fact that both services are reducing at a faster rate than could have been foreseen 18 months ago when the Estimates were originally prepared. Obviously if services are reduced the receipts for supplying them are also automatically reduced. Also, the cost of supplying the services is reduced. That fact is not apparent from the printed Supplementary Estimate, which fully justifies the hon. and learned Gentleman raising the point.
If hon. Gentlemen will look at sub-head (c), on page 52, they will see there an anticipated saving of £300,000 on county agricultural executive committee expenditure. That sum is the balance in savings and excesses in various departments. Among them are £190,000 for gang labour and £270,000 for machinery. The general effect, leaving out of account the £2 million already referred to, is that gang labour receipts for the year now closing are going down by £270,000 and expenditure by £190,000, compared with the original Estimate. The main reason why expenditure went down less than receipts by approximately £80,000 was due to the extra cost in transporting pool labour to the various farms, the rising costs of hostels and one or two other matters affecting the Women's Land Army and so forth. It will be clear to hon. Gentlemen that as the gang labour force diminishes the hostels become more costly until some of them can be concertinaed, and some of them closed down.
Hon. Gentlemen will see at a glance how difficult it is to estimate 18 months ahead when this has happened since 1948. 141 We then had 54,000 in the gang labour pool but they have already been reduced to 19,000. They are being reduced still further. So far, that explanation clearly indicates that there has been no extra expenditure by the State, and certainly no extra losses on gang labour or machinery, except the inevitable loss when we are reducing a service and our hostels are only half or one-third occupied, until some of them can be closed.
The same story can be told with regard to machinery operations. Here there are reductions in receipts of £300,000 and a saving in expenditure of £270,000, which is not a big difference. The explanation is very simple, merely a reduction in machinery operations. All the savings are slightly behind reductions in receipts. Again, that indicates that while the county executive committees are persuading farmers or contractors wherever they will fill the breach to do all the work they possibly can with their own machines or contractors' machines, county executive committees are left with such machinery as they retain—by the end of this year I anticipate that it will be less than 50 per cent. of what it was in 1948—and they will have all the difficult jobs to do which nobody else would undertake, and that work would not be done but for the county agricultural machinery.
Hon. Members may like to know that both with regard to gang labour and machinery operations there has been a steady increase in efficiency over the past few years. In the case of gang labour, to which the hon. and learned Gentleman referred so frequently in his references to the Report of the Select Committee, the percentage of wages recovered in 1946–47 was only 59. In the first three quarters of 1949–50 the recovery has reached 91 per cent., which indicates that the county executive committees have not only been very rapidly reducing their pool labour but have also been increasing the efficiency of the use of that labour. I repeat that by the end of 1950 we expect that machinery will be down to approximately 50 per cent. of what it was in 1948.
I believe that both gang labour and the machinery service played a very useful part in our expansion programme. If one cares to look at any part of the country it is obvious that, had it not been for the gang labour and the machinery service, we could not have achieved what has been achieved over the last few years. 142 The last time we discussed the eleventh Report of the Select Committee I said that nobody ever expected that the machinery service would be a paying proposition. After all, each county executive committee turned itself into a training department, a placing department and a social service at the same time, and I believe that when hon. Members reflect upon the sort of men we had to take into our service they are bound to agree that in the circumstances a really decent job of work has been done. I believe that both services have played a very useful part in the expansion programme.
I hope that the Committee will be satisfied with the explanation that I have given, that no extra loss or cost to the State is involved in this Supplementary Estimate but that it is merely a question of cash receipts for services rendered not having been paid from one part of a county executive committee to another. There is only one other word I ought to say and that is with regard to the hon. and learned Gentleman's reference to the sale of surplus machinery. The answer to that is that surplus machinery is not treated at all as appropriations in aid but as Exchequer extra receipts. They will, therefore, form an item in some future balance sheet which gives the Treasury full credit for any income received from the sale of surplus machinery.
§ Mr. Manningham-Buller
Before the right hon. Gentleman sits down, would he deal with my question regarding lands in possession?
Yes, I am sorry I missed that. The £1 million surplus referred to on page 53 is, as the hon. and learned Gentleman said, a carry-over of crops and potatoes from a previous year, and they were largely potatoes. I do not know that the Ministry of Food subsidise these potatoes any more than they subsidise any other potatoes produced in the country.
§ 8.46 p.m.
§ Mr. Turton (Thirsk and Malton)
If I were to be charged with a serious crime of which I was guilty, I could choose nobody better than the Minister of Agriculture to prosecute or to present my case. Hon. Members listening to him would fail to realise that the Minister was coming down to the House to say, "I 143 want another £2 million because I made a mistake in accounting." That is really what it comes to, although he said, "It is not a greater loss, it is merely a deficiency in my receipts."
As I understand the right hon. Gentleman, he presented to the country and the nation a statement saying that he would obtain from farmers some £2 million for farming operations which in fact he did not expect to get at all but was Merely to credit from his own lands in possession. In other words he was going to transfer £2 million of money from his right-hand trouser pocket to his left-hand trouser pocket and was calling that a receipt. That is a grave admission of bad financial administration from a Minister of Agriculture. After all, the chief claim of the Minister of Agriculture to fame is not finance but knowledge of farming, and what surprises me in this Debate is that there is on the Government Front Bench no responsible representative of the Treasury who is equally to blame with the Minister for what is a gross financial muddle.
§ Mr. Turton
The Minister says there is no blame and no muddle. Perhaps he has convinced himself, but if he comes to the House of Commons and asks for another £2 million he must have made some mistake. When I asked him whether this was a mistake in only one year he said, no, that his Department had been carrying on this mistake for a number of years.
I have in my hands a document published only last week, the Appropriation Accounts which is signed by the Comptroller and Auditor-General. I imagine the Minister will agree that the Comptroller and Auditor-General knows the difference between a notional receipt and an actual receipt. The Comptroller and Auditor-General in going through these accounts for the previous year 1948–49, makes it quite clear that the amounts actually received were what had been passed in the Estimates. They were £13,883,516 for gang labour and £6,592,503 for the expenditure on machinery operations, and the receipts for machinery and gang labour amounted to £16 million odd. It is clear from that review that if the Minister is right that he has been carrying on this system of 144 false accounting for a number of years, he has successfully deceived not only the House and the country but also the Comptroller and Auditor-General.
I hope that on reflection the Minister will see that this mistake is a mistake not quite so careless as he represented it to the House, that it is a mistake which occurred only this year. This was made fairly clear when his Director of Accounts was addressing the Estimates Committee and was talking about how they dealt with this problem which arose when their gang labour and machinery was used for lands in possession. The Director of Accounts, in answer to a question by Mr. Scott-Elliot, to which my hon. and learned Friend the Member for Northants, South (Mr. Manningham-Buller) has referred, said, at paragraph 475 on page 50 of the Report:… we did agree in the quite early days of the war with the Treasury Officer of Accounts that in the Ministry accounts we would not give effect to these very voluminous transfers—he was talking of the expenditure on lands in possession.Their effect would be to inflate both sides of the Exchequer account by several million pounds. They are given effect to in the books of the committees, and they will be reflected in these income and expenditure accounts. Therefore gang labour or machinery hired by land in possession will be shown as expenditure on lands in possession and as income for the other departments.As there was that Treasury ruling, surely the Minister will now agree that this is the first year when they have disobeyed it.
§ Mr. Turton
The right hon. Gentleman is making his own crime and that of his Ministry so much graver. Not only have they this year presented a completely false position to the country and pretended that they were receiving money which they never received, but they had done it in previous years contrary to the express ruling of the Treasury; and when a responsible Select Committee of this House examined their Director of Accounts, this gentleman told the Estimates Committee that that was the position and that that was the Treasury Ruling.
What the Minister has done has not been to inflate both sides—the lands in possession and the gang labour and machinery receipts. What he has done has been to inflate the gang labour and 145 machinery receipts and to leave them out from the lands in possession expenditure, which is really a very grave misleading of the country. What were the Treasury doing in all this matter? Do they not have some responsibility?
When the Estimates Committee were examining these accounts—this is purely an accounting problem—they sat, if I remember aright, from November, 1948, until 26th May, 1949, taking evidence on these very matters. As one who was a member of the Estimates Committee, I feel tonight some degree of responsibility because I did not find out during those proceedings that the Minister was conducting this very negligent system of finance. I think we ought to have found it out. True, every witness from the Ministry covered it up and said they were not doing this, but it was there really latent for everybody to see, that there was something very phoney about what the Minister was claiming would be his receipts, because he had put his receipts at too high a figure. Surely, the Treasury ought to have done something about this?
From annex 8 on page 272 of the Report, dealing with agriculture machinery, we learn from paragraph 5—this is the Minister's own Memorandum to the Select Committee of Estimates—thatIncome for 1949–50 was estimated at £3,650,000. This is practically the same as the previous year's estimate but was based on …certain assumptions. If I am right, and if the estimate for the previous year was not a false estimate but was a true estimate, as the Comptroller and Auditor-General has certified in his certificate published last week, then surely the Minister was quite wrong to take that estimate of the previous year and to build it up, when he knew that the machinery operations, as he told us today, were declining very rapidly; whereas he put the figure at the previous year's estimate. This goes on:The question of the machinery service has been further reviewed by the Treasury since these estimates were made and the total estimated receipts have now been increased by a further £150,000 to a total of £3,800,000.I ask whoever is to reply to the Debate how it was that the Treasury were enabled to review these Estimates, which are admitted now to be contrary to the whole Treasury ruling and are admitted to be phoney estimated receipts, why the 146 Treasury were allowed to increase them by a further £150,000.
§ Mr. S. O. Davies (Merthyr Tydfil)
On a point of Order. Is it in Order, while the subject matter is under consideration, to refer to and to enlarge upon imaginary defections on the part of the Treasury?
§ Mr. Deputy-Speaker (Major Milner)
Certainly, if it has relation to the particular Estimate before the House.
§ Mr. Turton
I did not talk about the Chancellor of the Exchequer. If I should do that, and I agree that that is probably the right way of doing it, I ask, how is it that the Chancellor of the Exchequer, in his responsibility, did not become aware in that review that there was this error of £1 million that the Minister has admitted today in his machinery estimates? I believe this to be not a party matter. It is purely a question of financial control and ministerial responsibility for finance. I think many hon. Members on both sides of the House who took part in examining the Estimates of the Ministry of Agriculture share my view that there was something very wrong about the presentation of finance of the trading services. It is a new problem for Ministers and for Parliament when we have a Department that is indulging in trading operations and sometimes selling its services to the ordinary citizens of the land and sometimes carrying out operations for another branch of the same Department.
We realised that in our Committee's Report and said that in our view the Ministry's accounts were muddled and confused and we recommended to the Minister that he should take certain action. It was on these lines, that he should prepare trading estimate and a capital estimate. We recommended that those estimates should in future be prepared in a different way, so that the receipts and expenditure for each service should be set side by side in order that taxpayers and we who represent taxpayers should know exactly what was happening in each of these trading services. May I remind the Minister that in his Departmental replies to that recommendation he said:It is impossible, without imposing a wholly disproportionate amount of additional work on Committees, who analyse the cash receipts and certain substantial cash payments under the various trading services.147 When I read that it seemed to me to be an admission that there was something very wrong in the accounts Department of the Ministry of Agriculture if they were not able without a disproportionate amount of additional work to analyse what were the cash receipts. It is a pity this work was not undertaken a little earlier because if it had been undertaken the Minister would have found earlier on that £2 million of the cash receipts in the estimates were not cash receipts at all but merely this transfer from his right hand trouser pocket to his left hand trouser pocket.
I would seriously suggest to the Minister that he reads again the recommendations of the Select Committee on Estimates on how he should present and keep his accounts to Parliament. We have not a responsible Minister of the Treasury here today on the Government Front Bench. I ask that the Financial Secretary to the Treasury or the Chancellor of the Exchequer should go into this matter with the Minister of Agriculture and see how these mistakes can be prevented in the future.
It is all very well for the Minister to say that no question of loss is incurred in this matter. If he takes his machinery services he will find that he had paid out some £1,700,000 more than he has received, and his percentage of recovery on the machinery services this year is 60 per cent.
§ Mr. Turton
I am the last person to want to mislead the House. If the Minister says that what I have said is not true will he let us have the correct percentage, for he will find that the estimate of receipts is now £1,700,000 less—
Shall I correct the hon. Member before he goes any further? He says that the collection for machinery services is 60 per cent. this year. It is 78 per cent. It is true that the hon. Member is only 18 per cent. wrong, but the percentage is 78.
§ Mr. Turton
I ask the Minister a simple question. I said the estimate of the receipts is at present £1,700,000 less than the estimate of expenditure. These are the figures which he himself has presented to the House in his Estimates. In 148 other words, the gross expenditure on machinery is £4,300,000 and the gross estimated receipts, as now revised by this Supplementary Estimate, are £2,600,000. If the right hon. Gentleman will then do that sum he will find that the percentage recovered is 60. I know on what basis the Minister is now working. He is still labouring under the delusion about transfers from his right to the left pocket. He thinks that what he has removed from the right to the left pocket is a receipt and it is not. The percentage recovered is 60. The Minister told the House, and his witnesses before the Select Committee on Estimates told that Committee, that the percentage recovered in 1949–50 was the best percentage the Department had ever had. In fact it is the worst in any time on record if these figures are correct.
Surely this is a matter upon which we must have some clear indication that this House and this country will not be misled on these matters as they have been in the past year, as I say, and in the past three years, as the Minister says. We are representatives of the taxpayers of this country—
§ Mr. Turton
It is all very well for the hon. Member to come into the Chamber after having had his dinner and begin interjecting in a hilarious way. This is a matter of £2 million of the taxpayers' money which is admitted to have been wasted. It is a very serious matter that nearly £2 million is to be claimed from the taxpayers of the country because the Minister has no financial control of his Department. I beg the Minister of Agriculture and the Treasury to go into this matter so that in future these mistakes do not occur, that a better system is devised of presenting these trading estimates to Parliament so that earlier in the year we shall know what the loss really is.
§ 9.5 p.m.
§ Major Sir Thomas Dugdale (Richmond, Yorks)
The House owes a great debt of gratitude to my hon. and learned Friend the Member for Northants, South (Mr. Manningham-Buller) and my hon. Friend the Member for Thirsk and Malton (Mr. Turton)—[HON. MEMBERS: "Oh"]—who were both members of this Select Committee who published the 11th Report in 149 the summer of last year, for raising this particular point this evening. It is interesting to hear the jeers from hon. Members on the other side of the House when I make those remarks, because above all else it is the function of this House to safeguard public finance from Executive misspending. It is one of the chief functions of hon. Members of this House.
The Minister has contradicted himself in making a reply to my hon. Friend, because in his defence of this very extraordinary state of affairs revealed in this Supplementary Estimate he said that this was a very serious question. Later on when my hon. Friend the Member for Thirsk and Malton was speaking, the Minister said there was no blame or muddle attached to anybody. Both of those statements cannot be right, and I think that the Minister was probably correct when he said that this is a very serious question.
It is not for me to go into the merits or demerits either of the gang labour service or the machinery service; indeed I do not believe it would be in order to do so on this particular Vote. But I would ask the Minister to explain this to the House: If, as he says, there is no money attached to this particular deficit and to this particular Supplementary Estimate, why does it appear in this document—passed by the Chancellor, and produced to the House—as an addition to the other Supplementary Estimates to the tune of £1,650,000 under sub-head Z?—because that is money required.
In his reply to my hon. Friend the Minister said we could not really understand this problem until the end of the financial year when we got the trading accounts. Is it true to say that what has happened is that he has taken a Supplementary Estimate for the year 1949–50, and then it is credited back to his Department after the end of the financial year as a credit in the trading accounts which are published some time next month? If that is the case, again I think the House will agree that the whole position could not be more unsatisfactory.
We had a Debate at the end of last year on 8th December, which was not, as the Minister has stated, a long Debate. It was quite short, and many hon. Members were unable to take part in it. But it was a Debate on the whole of this 11th Report. What emerged from it was 150 the fact that the present method of accounting for these trading services was unsatisfactory. There again, we have an instance of this in these particular Supplementary Estimates, and if my hon. Friend had not seen fit to draw the attention of the House to this Debate it would not go out to the country that, in fact, the Minister had lost over £2½ million in these two particular services for which he is responsible, namely the gang labour service and the machinery service.
Because we have had this Debate the House has been able to reassure itself that the Minister is taking something front one pocket and putting it into the other; but that does not make the position any more satisfactory. I ask the Minister to assure the House that we will not have any more of this business in the next financial year. Accountancy plays, a very important part in any Minister's life. When these enormous sums are being spent from public funds by his Department, and by every other Department, then it must be right that we should have a proper system of accountancy. I took the liberty in the last discussion on this point to suggest to the House that we shall never get a true picture and understand what is going on until we can have the accounts of the county committees published county by county. I still feel that that is the proper solution, and that when the Minister has decided to do that we shall not have to debate intricate points of detail about accounts which have been proved to be so unsatisfactory.
§ 9.11 p.m.
Mr. T. Williams
I do not think that there is much to reply to unless I repeat what I said earlier. I should like, however, to say a few words about the hon. Member for Thirsk and Malton (Mr. Turton) and the hon. and gallant Baronet the Member for Richmond (Yorks) (Sir T. Dugdale). They claim to be wholehearted supporters of county agricultural executive committees and the work which they are doing, but they never lose an opportunity of making an indirect attack upon them. This is one more occasion where they have taken the opportunity of this Supplementary Estimate to make back-handed attacks upon the county executive committees and their work.
One moment. The hon. Member for Thirsk and Malton uses these words when referring to the county executive committee accounts, "They are false; they are deceiving the nation; they are misleading, and they are negligent" and perhaps one or two other—
§ Mr. Turton
I wish the right hon. Gentleman would repeat what I said instead of something which is entirely untrue. I said that the Minister's accounts were untrue and false, but I never said that the county executive committee's were, because those are not cash accounts. That shows the Minister's complete ignorance of the whole system of accountancy.
I am delighted to have such a wonderful teacher as the hon. Member for Thirsk and Malton to get me out of my ignorance; but he must pass the first standard in accountancy himself before he can become a teacher. I should like to remind him once again that he was a member of the Select Committee which issued the 11th Report and that he, like the hon. and learned Member for Northants, South (Mr. Manningham-Buller), is able to quote from that Committee. The hon. Gentleman said that these accounts were false; that they were deceiving the nation; that they were misleading and negligent. The hon. Baronet referred again to this loss. He cannot have understood or listened to a word that I said, or he could not use the word "loss" since there is not the loss of one single penny shown in this Estimate.
I hate to repeat myself, but I must say once again that if the county agricultural executive committees who run the gang labour service and the machinery service charged and received cash payments for services rendered, this Estimate in this form would not have been necessary. I said earlier that if a cash payment had been made for services rendered, this Supplementary Estimate would not have been necessary in this form, but a similar Supplementary Estimate would have had to be provided for the work of food production. I made that very plain. Therefore, there is no dodging, no misleading, no deception and there is no loss. Whatever else may have been said by the hon. Member for Thirsk and Malton, the hon. Baronet and the hon. and learned Gentleman, they cannot prove that this Estimate means the payment of one single penny 152 piece for gang labour or for machinery services.
I am trying to follow the right hon. Gentleman's rather difficult and confusing argument. Is he saying that we really need not worry about this Supplementary Estimate, because, if there had not been a deficiency on gang labour or machinery, there would have been a greater deficiency on land in possession? Is he saying that, in that event, there would have been a Supplementary Estimate asking for another net figure of £1,650,000 from the taxpayers? If this is the effect of his conduct of these operations, is it not the fact that the Estimates must have been wrong, and that, whether the Minister calls it a loss or not, the taxpayer is being asked for much more money that was anticipated?
I happen to have been in this House much longer than the hon. and learned Gentleman. I have sat in Opposition for 18 years when a Conservative Government was in power. I have heard every Supplementary Estimate, year in and year out, produced by Conservative Ministers, and, if the hon. Member for Thirsk and Malton comes over to this side for a short time, I tremble to think what sort of Estimates he would produce, when he has to provide Estimates 18 months before the end of the financial year. Every hon. Member who has spoken in the Debate knows full well that, if a county executive committee, with its internal trading arrangements, has to produce estimates 18 months in advance, they cannot be expected to be accurate. Hon. Members are asking for what is impossible.
I only need to say this to the hon. Member for Thirsk and Malton, the hon. Baronet and the hon. and learned Gentleman. It is perfectly proper for hon. Members of the Opposition, or indeed hon. Members in any part of the House, to raise questions on Supplemetary Estimates and to seek information upon them when they have been submitted, but I doubt if it is either fair or reasonable to characterise a Supplementary Estimate as "false," "deceptive," "misleading," "negligent" and all the other adjectives that have been hurled across the Floor of the House.
The county committees are doing a good job of work, but there were no such 153 things as accounts during the war when the right hon. Member for Southport (Mr. R. S. Hudson) was the Minister. I do not remember the hon. Member for Thirsk and Malton, the hon. Baronet or the hon. and learned Gentleman asking one single question about the expense to the taxpayer in those days. It is only recently, since they sat on the Select Committee which issued this 11th Report, that they have discovered that the accountancy may not be quite what it ought to be.
I said that credit had been taken wrongly for receipts for labour services and machinery services. I admitted that in the first minute of my earlier observations. Why that was not enough for hon. Members Opposite I do not understand, but I hope I have made it very clear and that the explanation I have given is now satisfactory.
§ Mr. Manningham-Buller
In view of the plea of "guilty" which the right hon. Gentleman has entered, and having regard to the fact that he has held out some hope or indication that he is not intending to repeat the offence, I beg to ask leave to withdraw the Amendment.
§ Amendment, by leave, withdrawn.
§ Question, "That this House doth agree with the Committee in the said Resolution," put, and agreed to.
§ Resolution reported: