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THIS D O C U M E N T I S T H E P R O P E R T Y O F H I S B R I T A N N I C M A J E S T Y ' S
Printed
Sf£RKT.
w
for
the
War
Cabinet.
July
GOVERNMENT
1942.
y
'
Copy No.
p. (42) 294.
July 14, 1 9 4 2 .
TO B E
KEPT
UNDER
LOCK
AND
KEY
I t is requested t h a t special care m a y be t a k e n to
ensure the secrecy of this document
WAR
THE
Memorandum
CABINET.
SHIPPING
by the Lord
SITUATION.
President
of the
Council.
THE Committee a p p o i n t e d in M a y to keep t h e s h i p p i n g situation u n d e r
review (W.P. (42) 192) have now submitted their first R e p o r t ( W . P . (42) 293)
reviewing shipping requirements over the period of eighteen months from the
beginning of 1942 to the end of J u n e , 1943.
On the assumptions set out in p a r a g r a p h 3 of their R e p o r t they estimate
that during t h i s period non-tanker i m p o r t s will total 35 million tons, of which
33 million tons will be i m p o r t s of food and m a t e r i a l s . I f consumption policy
remains unchanged, the net consumption of importable food and materials
during this period will total 4 1 - 4 million tons. T h e r e is t h u s a deficiency of
8-4 million tons.
2. The Committee set out in t h e i r R e p o r t the measures which m i g h t h a v e
to be taken to close t h i s g a p if no f u r t h e r assistance were forthcoming from the
United States a n d the deficiency h a d to be met wholly from our own resources.
The import savings represented by these measures may be summarised as
follows :—
De-stocking.
Million
R u n n i n g down stocks of food a n d r a w m a t e r i a l s
Consumption
economies:
Food.
...
...
tons.
6-15
Tons.
Increased food y i e l d f r o m 1942 harvest
...
R a i s i n g milling r a t i o to 90 per cent
Dilution of bread by rye, barley and oats ...
Reduction of the reserve of m e a t on the hoof ...
500.000
150,000
560,000
100,000
1-31
Consumption
economies:
Raw
Materials.
Cut i n i m p o r t s of fertilizers, a t the expense of
t h e 1943 harvest
Economies in steel a n d steel-making m a t e r i a l s
Economies in m a t e r i a l s other than"steel
...
400,000
400,000
200,000
100
These measures would, close the g a p , w i t h o u t t a k i n g into, account such f u r t h e r
savings as could be secured by economies in the use of s h i p p i n g for m i l i t a r y
Purposes and for civil imports to t e r r i t o r i e s other t h a n the U n i t e d K i n g d o m
[24092]
3. T h e Lord P r e s i d e n t s Committee agree t h a t , without additional
American assistance, the prospects of our s h i p p i n g situation over the next
eighteen months wouid indeed be grave. If we were compelled to meet this
situation wholly from our own resources, the drastic measures of retrenchment
which we should be forced to take m i g h t damage national morale and limit our
capacity to carry on the w a r w i t h full vigour a n d efficiency. Moreover, the
adoption of these measures would reduce us by mid-1943 to a condition in which
our stocks of food a n d m a t e r i a l s would be so far diminished t h a t we should be
unable to carry on t h e w a r w i t h o u t a measure of A m e r i c a n assistance far in excess
of any on w hich we have h i t h e r t o been able to rely. Stocks would have been run
down to a point at which it would become essential to raise the r a t e of imports
from 9-i- million tons in the first half of 1943 to 15 million tons in the second half
of that" y e a r — a n d for this s h a r p expansion of i m p o r t i n g capacity we should
have to rely almost entirely on A m e r i c a n s h i p p i n g .
r
4. I t would be a mistaken policy, from the p o i n t of view of the common
interests of the U n i t e d Nations, to postpone a n increase i n the allocation to this
country of new s h i p p i n g from A m e r i c a n y a r d s u n t i l we h a d reached a point at
which our capacity to carry on the w a r effectively was seriously jeopardised.
I n these circumstances my Committee consider t h a t the situation should, if
possible, be met on the lines contemplated in p a r a g r a p h s 2 1 - 2 4 of the Report of
the S h i p p i n g Committee—i.e., by a s u b s t a n t i a l increase in American assistance
in the first, as well as the second, half of 1943, combined w i t h measures of
retrenchment (running down stocks, and reducing consumption, of imported
food and r a w materials) which, t h o u g h substantial, will be less drastic than
those which we should have to adopt if the prospective deficiency in importing
capacity h a d to be met wholly by these means.
5. My Committee have reviewed the possible measures discussed by the
S h i p p i n g Committee for reducing our consumption of imports. They feel that
some of these measures would dislocate our economy to a n extent which would
not be justified in present circumstances. They could not recommend at this
juncture—
(a) T h e use of barley as a diluent in bread, at the cost of reducing beer
supplies by half;
(&) the reduction of the reserve of meat on the hoof;
(c) any cut in imports of fertilizers a t the expense of the 1943 harvest.
F u r t h e r , they doubt whether t h e relatively small saving i n w h e a t imports would
outweigh t h e disadvantages of increasing t h e milling r a t i o beyond 85%. In
any event they would not favour a n increase above 9 0 % .
The r e m a i n i n g measures suggested by t h e S h i p p i n g Committee might be
expected to produce savings in imports of food a m o u n t i n g to a maximum of some
800,000 tons.
A s r e g a r d s imported m a t e r i a l s consumption economies to the extent of about
600,000 tons could be secured without serious p r e j u d i c e to direct w a r production
—though t h e cuts involved would fall very heavily on services supplying civil
needs.
Stocks might p e r h a p s be reduced by 4 million tons, in place of the 6-15
million tons contemplated by the S h i p p i n g Committee.
There is no prospect of a n y substantial saving in civil imports to territories
other than the U n i t e d K i n g d o m . Some relief m i g h t be obtained through further
economies i n the use of s h i p p i n g for military p u r p o s e s ; but the Lord Presidents
Committee are not in a position to frame a n y q u a n t i t a t i v e estimate of the savings
to be secured by this means.
I t is clear, however, that, even though we make these s u b s t a n t i a l reductions
in our demands on s h i p p i n g and enforce every economy in our use of the ships
available, we cannot hope to meet the prospective deficiency unless we can obtain
from the U n i t e d States assistance enabling us to b r i n g in something not far short
of an additional 3 million tons of imports before the middle of 1943. I f assistance
on this scale is not forthcoming we may reach the point at which it will become
impossible to meet in full the urgent needs of the fighting Services for shipping
without reducing imports below the minimum level required to m a i n t a i n our war
production and to supply our essential civilian requirements.
Large as is the p l a n n e d o u t p u t of U n i t e d S t a t e s new construction, their
nresent high r a t e of s h i p p i n g losses may not be reduced for some time, while
demands on s h i p p i n g involved in b r i n g i n g U n i t e d S t a t e s troops to E u r o p e a r e
likely to be extremely large. I n the absence, therefore, of some firm assurance
from the United States Government, it is not safe to assume t h a t they will be able
t provide assistance of the p r o p o r t i o n s required.
0
6.
My Committee therefore submit the following recommendations :—
(a) The facts of the s h i p p i n g s i t u a t i o n should be strongly represented to the
U n i t e d States Government. I t should be m a d e clear that, from our
own resources and w i t h the A m e r i c a n help already available, we cannot
meet the prospective deficiency in i m p o r t i n g capacity w i t h o u t a d o p t i n g
a policy of r e t r e n c h m e n t which would seriously i m p a i r our ability to
carry on the w a r after the middle of 1943. A m e r i c a n assistance will
in any event be required on a s u b s t a n t i a l scale in t h e second half of
1943. But in the common interests of the U n i t e d N a t i o n s as a whole
it is preferable t h a t we should receive in the early p a r t of 1943 such
a measure of assistance as will enable us to keep stocks a n d consump­
tion a t reasonable levels a n d t h u s obviate the need for a much steeper
increase of i m p o r t s in the second half of t h a t year.
For these reasons the U n i t e d S t a t e s a u t h o r i t i e s should be pressed
to increase the tonnage of s h i p p i n g to be allocated in the first half of
1943 to areas for which we a r e responsible. W e should make every
effort to o b t a i n firm assurances r e g a r d i n g the tonnage which can be
made available d u r i n g the whole of next year. I t should be sufficient
to enable us to bring in at least 3 million tons of i m p o r t s d u r i n g the
first half of t h a t year.
(&) The extent to w h i c h stocks, and consumption, of imported food and
materials will have to be reduced in order to close t h e r e m a i n i n g a a o
cannot be calculated w i t h precision u n t i l we know w h a t a d d i t i o n a l
shipping can be made available to us from A m e r i c a n production.
Provisional plans should, however, be p r e p a r e d on the assumption that
import economies totalling about 51 million tons will have to be secured
over the period of eighteen months up to the end of J u n e 1943. C e r t a i n
economies in consumption of imports may have to be introduced
forthwith.
(c) Every practicable economy must be secured in the use of the available
shipping. T h e S h i p p i n g Committee a r e m a k i n g further enquiries
into this aspect of the problem: a n d in consultation w i t h t h e M i n i s t e r
of W a r T r a n s p o r t they will review all the possible m e a n s of securing
a more economical use of t h e ships engaged in s u p p l y i n g civil and
military r e q u i r e m e n t s .
If, however, a n y s u b s t a n t i a l reduction is to be secured in the
demand u p o n s h i p p i n g for m i l i t a r y purposes, it will be necessary to
b r i n g under review m a t t e r s (e.g., scales of m a i n t e n a n c e a n d reserves)
which raise issues of m i l i t a r y policy outside the competence of the
S h i p p i n g Committee. These aspects of the problem will, no doubt, be
considered by the Defence Committee w i t h a view to the issue of
suitable Directives to t h e Service D e p a r t m e n t s .
J . A.
Great George Street, S.W. 1,
July 14, 1942.