For many weeks only trench fighting has been possible owing to the climatic conditions and waterlogged state of the ground. During this period of apparent inaction, it must not be forgotten that our troops have had to exercise the utmost individual vigilance and resource, and, owing to the proximity of the enemy's lines, a great strain has been imposed upon them. Prolonged warfare of this sort might be expected to affect the morale of an army, but the traditional qualities of patience, good temper, and determination have maintained our men, though highly tried, in a condition ready to act with all the initiative and courage required when the moment for an advance arrived. The recently published accounts of the fighting in France have enabled us to appreciate how successfully our troops have taken the offensive. The German troops, notwithstanding their carefully prepared and strongly intrenched positions, have been driven back for a considerable distance and the villages of Neuve Chapelle and L'Epinette have been captured and held by our army, with heavy losses to the enemy.

In these operations our Indian troops took a prominent part and displayed fine fighting qualities. I will in this connection read a telegram I have received from Sir John French:

Please transmit following message to Viceroy India: I am glad to be able to inform your Excellency that the Indian troops under General Sir James Willcocks fought with great gallantry and marked success in the capture of Neuve Chapelle and subsequent fighting which took place on the 10th, 11th, 12th and 13th of this month. The fighting was very severe and the losses heavy, but nothing daunted them. Their tenacity, courage and endurance were admirable and worthy of the best traditions of the soldiers of India.

I should like also to mention that the Canadian Division showed their mettle and have received the warm commendation of Sir John French for the high spirit and bravery with which they have performed their part. Our casualties during the three days' fighting, though probably severe, are not nearly so heavy as those suffered by the enemy, from whom a large number of prisoners have been taken.

Since I last spoke in this House substantial reinforcements have been sent to France. They include the Canadian Division, the North Midland Division, and the Second London Division, besides other units. These are the first complete divisions of the Territorial Force to go to France, where I am sure they will do credit to themselves and sustain the high reputation which the Territorials have already won for themselves there. The health of the troops has been remarkably good, and their freedom from enteric fever and from the usual diseases incidental to field operations is a striking testimony to the value of inoculation and to the advice and skill of the Royal Army Medical Corps and its auxiliary organizations.

The French army, except for a slight withdrawal at Soissons, owing to their reinforcements being cut off by the swollen state of the Aisne River, have made further important progress at various points on the long line they hold, especially in Champagne. Association with both our allies in the western theatre has only deepened our admiration of their resolute tenacity and fighting qualities.

In the Eastern theatre the violent German attacks on Warsaw have failed in their purpose, and a considerable concentration of German troops to attack the Russian positions in East Prussia, after causing a retirement, are now either well held or are being driven back. In the Caucasus fresh defeats have been inflicted by the Russians on the Turks, and the latter have also been repulsed by our forces in Egypt when they attempted to attack the Suez Canal. The operations now proceeding against the Dardanelles show the great power of the allied fleets, and, although at the present stage I can say no more than what is given in the public press on the subject, your Lordships may rest assured that the matter is well in hand.

The work of supplying and equipping new armies depends largely on our ability to obtain the war material required. Our demands on the industries concerned with the manufacture of munitions of war in this country have naturally been very great, and have necessitated that they and other ancillary trades should work at the highest possible pressure. The armament firms have promptly responded to our appeal, and have undertaken orders of vast magnitude. The great majority also of the employees have loyally risen to the occasion, and have worked, and are working, overtime and on night shifts in all the various workshops and factories in the country.

Notwithstanding these efforts to meet our requirements, we have unfortunately found that the output is not only not equal to our necessities, but does not fulfill our expectations, for a very large number of our orders have not been completed by the dates on which they were promised. The progress in equipping our new armies, and also in supplying the necessary war material for our forces in the field, has been seriously hampered by the failure to obtain sufficient labor, and by delays in the production of the necessary plant, largely due to the enormous demands not only of ourselves, but of our allies.

While the workmen generally, as I have said, have worked loyally and well, there have, I regret to say, been instances where absence, irregular timekeeping, and slack work have led to a marked diminution in the output of our factories. In some cases the temptations of drink account for this failure to work up to the high standard expected. It has been brought to my notice on more than one occasion that the restrictions of trade unions have undoubtedly added to our difficulties, not so much in obtaining sufficient labor, as in making the best use of that labor. I am confident, however, that the seriousness of the position as regards our supplies has only to be mentioned, and all concerned will agree to waive for the period of the war any of those restrictions which prevent in the very slightest degree our utilizing all the labor available to the fullest extent that is possible.