Bill for circulation in the current session, and for its passage in the following year. The Home Secretary apologised for the delay on the ground of grievous legislative pressure, and promised solemnly on the part of the Government to introduce his Bill in the current session and make it one of the principal measures of the next. It would, he said, contain nineteen-twentieths of Mr. Henderson's proposals, but not those relating to night baking. Unionist members accepted his assurance, and the motion was defeated by 184 votes to 109.

More ambitious than his colleagues, Mr. Maxton had given notice of a Bill for nationalising the Bank of England. Objection, however, was raised to this on the ground that it conflicted with the Standing Orders of the House in that it affected private interests. The matter was referred to a Select Committee, and this body, on March 14, decided that the Standing Orders ought not to be dispensed with, so that Mr. Maxton was not able to bring forward his Bill.

In accordance with the announcement contained in the King's Speech, invitations were sent in February to the Ministers of Labour of Belgium, France, Germany, and Italy, and to M. A. Thomas, Director of the International Labour Office, to attend a conference in London on March 15 for the purpose of settling difficulties of interpretation of the Washington Eight-Hours Day Convention. The invitation was duly accepted by all the parties, and the conference sat in London from March 15 to 19. At its close the Minister of Labour, Sir A. Steel-Maitland, who had presided at most of the meetings, said that Great Britain had decided to call the conference because it desired to see how far it was possible to secure agreement among the principal industrial States as to the principles on which there could be based an international agreement for the regulation of the hours of labour. In particular, the British Government felt it necessary to examine the difficulties surrounding the Washington Convention, and to examine to what extent it would be practicable to ensure uniformity of interpretation, combined with assurances as to effective operation and enforcement. He felt that the conference had been able greatly to advance the consideration of the whole question of hours of labour from the international standpoint, and he undertook to submit its conclusions to his Government.

In the next session, on April 30, the Labour Party in the House of Commons revived the Bill which it had introduced when in office, to give effect, so far as England was concerned, to the eight-hours rule laid down in the Washington Labour Convention of 1919. The Government spokesman did not directly oppose the Bill, but stated that it was advisable to take further time for reflexion and for examining the intentions of other countries, and the debate was finally adjourned without a vote being taken on the Bill.

The text of the Government's anxiously-awaited Economy Bill was published on March 11, and was found to contain provisions for effecting a saving of 8 to 10 millions in the ensuing financial year, and 7 to 9 millions in the year after. Mr. Churchill, in moving the second reading on March 16, explained and defended the proposals in detail. The first was to reduce the State contribution to health insurance from two-ninths to one-seventh for men and one-fifth for women. This step was justified by the speaker on a number of grounds. First, there was the passage into law of the Widows and Old Age Pensions at Sixty-Five Bill of the previous year, which as from the beginning of 1928 would take off from the Health Insurance Fund all contributors between 65 and 70, the period when sickness benefits were at a maximum. This relieved the Fund of a sum which was actuarially computed at 37,000,000l. The second ground was the rise in the rate of interest since the war, as a result of which the regular income from the investments of the Fund was being increased by nearly 2,000,000l. a year, and this money free of tax. The same cause operated to the detriment of the State, which had to pay higher interest on its loans. Thirdly, in the past fourteen years the State had allowed some 24,000,000l. to enure to the benefit of the Fund from unforeseen advantages. The Fund was in an exceedingly prosperous condition, and a Royal Commission which had just examined its working had reported that, after providing for large additional benefits, it would still have a surplus of 2,000,000l. per annum. The Government had therefore decided that the State contribution to national health insurance could, in justice and prudence, be reduced as provided in the Bill, without prejudicing in any degree the solvency of any part of the system or of any individual society.

The second field in which economy was to be effected was that of unemployment insurance. Mr. Churchill admitted that there was an apparent inconsistency in legislating to reduce the State grant to the Unemployed Insurance Fund only nine months after they had legislated to increase it (vide ANNUAL REGISTER, 1925, p. 55), but circumstances had changed in the interval. In July, when they passed their Bill, they had contemplated an average live register for the ensuing twelve months of 1,300,000, but in fact at the worst period the register had been only 1,150,000, and the Fund had practically balanced. On the assumption that there would be no great industrial catastrophe, and on the basis of elaborate mathematical calculations, they estimated for an average live register for 1926 of 1,030,000, and they thought that on that basis a reduction of the Exchequer contribution to unemployment insurance from 63d. per week to 6d. (instead of an increase to 8d. as originally intended) could prudently and properly be made, without in any way affecting the solvency of the Fund or the amount of the benefits. The employers, however,

would not for the present receive the reduction in their contribution which they were expecting.

was

Leaving aside the other items of the Bill (the chief of which was a proposal to transfer to the Government 1,100,000l. from the Army, Navy, and Air Force Insurance Fund), Mr. Churchill proceeded to deal with the question why greater economies had not been effected, and in answer treated the House to what was, in effect, a preliminary Budget statement, containing an ingenious and novel analysis of the national expenditure with a view to finding possible economies. Taking as his starting-point the figure of 800,000,000l. to which the public seemed to have become accustomed during the past two or three years, he found there were four classes of demands which had to be met from this sum. The first consisted of what he called obligatory demands for interest on the National Debt and Pensions. The sum required for these purposes now 476,000,000l., as against 43,000,000l. before the war. The second class consisted of grants. made by the Exchequer to local authorities on the percentage system for education, health services, housing, and similar purposes. These required to-day about 90,000,000l. a year. Thirdly, there were the two great State services for promoting communications, the Post Office and the Road Fund, which, between them, absorbed about 67,000,000l. Reduction of the expenditure under these three heads was out of the question-under the first, because it was an obligation of honour; under the second, because it was necessary for the mental, moral, and physical welfare of the people; and under the third, because it produced a more than corresponding revenue. Thus, if the 800,000,000l. figure was not to be exceeded, there was left a sum of about 165,000,000l. out of which to provide for the Army, Navy, and Air Force, for the Civil Service, the tax-gathering department, the National Insurance Fund, Judges, Civil List-all those matters around which the battle of expenditure and economy had usually been fought. Mr. Churchill took great credit to himself and his colleagues for having brought the estimated expenditure on these items for the forthcoming year to within 3,000,000l. of this limit, the excess being allowed for the coal subsidy during April.

The rejection of the Bill was immediately moved by Mr. Snowden. He was followed by Sir J. Simon, who condemned the reduction of the Government's contribution to health insurance as a deliberate attempt to go back on a Parliamentary pledge, and other proposals in the Bill as unfair to employers of labour and to the education authorities. Unionist members received with regret, but with resignation, the information that there was little prospect of reducing the annual expenditure below 800,000,000l. Constructive proposals were singularly lacking in the debate, and after Mr. Neville Chamberlain had made a spirited defence of the proposal relating to health insurance the second reading was carried by 322 votes to 142.

The Government had intended to get the Economy Bill through its Committee stage before the House rose for the Easter recess, but the pertinacity of the Opposition in moving amendments made this impossible. When the discussion opened on March 31, an attempt was first made to induce the Government to postpone the clause reducing the State contribution to health insurance in order that an opportunity should be given to the millions of insured persons to make their voices heard at their Easter conferences. It was admitted by the Government that the Consultative Council of the approved societies had expressed disapproval of the clause, but the moticn for postponement was, nevertheless, heavily defeated. Mr. Thomas then moved that the clause should not come into operation earlier than six months after the summoning of a new Parliament, in order that the constituencies might have an opportunity of passing judgment on it. He read extracts from speeches upon the original insurance proposals in order to show that pledges as to increased benefits had actually been given, and warned the Government against doing anything which might destroy the belief that Parliamentary bargains would assuredly be kept. This plea was strongly reinforced by Mr. Lloyd George, who humorously remarked that in robbing the hen-roosts in his 1909 Budget he had gone to the well-feathered and well-defended nests, whereas this Government was robbing the few eggs from the backyard of the sick workman. Mr. Neville Chamberlain, in reply, said that he could never understand exactly what was the bargain which the Government was now supposed to be breaking. He had read over and over the original speech of Mr. Lloyd George in introducing the Health Insurance Act, but was unable to pin him down to any definition of the terms of the contract which he asserted was made. The Government was not raiding the surpluses of the approved societies, and he denied that it was committing any breach of faith. The Unionist majority rallied, as usual, to the Government and defeated the motion, but the Opposition kept the debate going all night, and prevented the Committee stage from being concluded before Easter.

The second reading of the Government's Electricity Bill was moved on March 29 by the Minister of Transport, Colonel Ashley. He began by calling attention to the backwardness of Great Britain in electrical development. It might be said that only about one-third of Great Britain was reasonably well supplied with electricity. Practically over all the rest of the country there were small undertakings incapable of generating at a sufficiently low price to encourage large-scale consumption. In consequence, the consumption per head in Great Britain was only 118 units—a very low figure in comparison with many other countries. There was no question that reorganisation was necessary in order to enable them to produce power as cheaply as any of their com

mercial competitors. Cheapness was largely a matter of big generating stations. In order to promote the creation of these, the Bill proposed the formation of an Electricity Board, to be nominated by the Minister of Transport, with a capital of 25,000,000l., which the Government would guarantee as to capital and interest. The Board would in no sense be a Government Department; it would be purely a private company, but it, would be authorised to buy up all the existing plants, which it would then standardise at a cost of about 8,000,000l., which sum also was to be raised by a loan to be guaranteed by the State. The task of generating electricity would still be left in the hands of the private undertaker, but the Board would see that a uniform price was charged to the consumer. In this way it was thought that the Bill would promote the public interest while maintaining private initiative. The Minister in the course of his speech acknowledged the Government's debt to Mr. Lloyd George's book," Coal and Power," from which it had derived many useful suggestions.

The Bill was opposed by the Labour Party and by a section of the Conservatives for opposite reasons-by the former because it did not go far enough in the direction of nationalisation, by the latter because it went too far. Mr. Graham moved its rejection on the ground that it "failed to provide for the co-ordination of the production of coal and its by-products with electrical generation, created cumbrous machinery, strengthened and extended the hold of profit-making companies over an indispensable public service, continued the limitation of municipal undertakings in confined and uneconomical areas of distribution, and afforded to consumers in company areas no adequate protection against excessive charges for light and power." The idea of a transition from a district to a national organisation was, he said, a sound one; but the Government's scheme of State intervention presented an administrative and economic bedlam. Conservative members were no less severe in denouncing the scheme from their point of view, as containing the evils of nationalisation without its possible compensations. The Bill duly passed its second reading, and was then referred to a Standing Committee, from which it did not emerge till the end of the Summer Session.

On the eve of the adjournment (April 1), Mr. Ponsonby raised the subject of disarmament, with the special purpose of ascertaining from the Government its intentions regarding the forthcoming conference of the League of Nations Committee on the subject. He was informed by Mr. Locker-Lampson, the Under-Secretary for Foreign Affairs, that the instructions to Lord Cecil, the British delegate to the conference, had not yet been framed, but the policy of the Government was quite clear. They were ready to assist whole-heartedly in any international steps leading to a general measure of disarmament, and Lord Cecil would certainly go to