RECIPROCITY OF DUTIES. (Hansard, 6 June 1823)

Mr. Huskisson
said it now devolved upon him to state shortly the nature of the alteration which he was about to propose in the commercial policy of the country. Although that alteration was in itself most important, and an entire departure from the principles which had hitherto governed our foreign commerce, yet his plan was so clear, and the benefit to be derived from it so obvious, that he trusted he should, in a few words, shew the committee the propriety of adopting it. Honourable members were aware that it had for a long time, indeed from the passing of the Navigation act, been our policy to impose upon cargoes, brought in foreign vessels, higher duties than those imported in British bottoms, and also in many instances to allow smaller drawbacks upon articles exported in foreign, than upon those exported in British ships. Now, whatever might be thought of the policy of such a measure, it was all very well so long as the nations with which we traded acquiesced in it. But when once the attention of those countries was called to it, it was not likely that such an inequality could last much longer. Accordingly it was found that the greatest commercial nation in the world, after Great Britain, and our great rival in trade—he meant the United States of America—finding the pressure of this tax, immediately commenced the retaliatory, system, by imposing duties upon all articles imported into that country by 796 British ships. The consequence of this was, that great embarrassment and inconvenience arose in the commerce between the two countries. So much so, that in cases where the increased duties countervailed the freight, it became necessary to have two sets of ships employed;, that was, to have British ships bring home American produce, and American ships taking our produce to that country; each being of course obliged to leave its own port in ballast. We however, in order to get rid of this inconvenience, were obliged to place American vessels on the same footing as English with respect to duties; and they, acting upon the system of reciprocity, did the same with respect to our ships. Portugal, finding the success which attended the course adopted by the Americans, soon obliged us to place her on the same footing. In a short time the pressure of this unequal duty began to be felt by other powers also, and steps were taken to adopt the retaliatory system. In July 1821, the United Netherlands passed a law, allowing a premium of 10 per cent. upon all articles imported in Dutch vessels. This was, in point of fact, though not directly, imposing a duty of 10 per cent. upon the cargoes of all other vessels. He was warranted in stating, that the government of the Netherlands, in adopting this regulation, were actuated by a sense of the disadvantage under which the commercial regulations of this country placed them; and that they did so, rather as a warning to us to change our policy, than a wish to establish it as a permanent measure; for he found that, though the law was passed in 1821, it was not to be acted upon until the beginning of 1823. Since that period it had been in operation, and had been strongly felt in the trade of this country with that power. But this was not the only power which had so acted. Prussia had also raised the dues on our vessels, and had intimated, in a manner not to be mistaken, that she would more fully adopt the retaliatory system, if we continued our present policy.—In such a state of things, it was quite obvious, that we must adopt one of two courses—either we must commence a commercial conflict through the instrumentality of protecting duties and prohibitions (a measure of impolicy which, he believed, no man would now venture to propose) or else we must admit other Powers to a perfect equality 797 and reciprocity of shipping duties. The latter, he thought, was the course they were bound to adopt. Its effect, he was persuaded, would lead to an increase of the commercial advantages of the country; while, at the same time, it would have a tendency to promote and establish a better political feeling and confidence among the maritime powers, and it would abate the sources of commercial jealousy. It was high time, in the improved state of the civilization of the world, to establish more liberal principles; and show, that commerce was not the end, but the means of diffusing comfort and enjoyment among the nations embarked in its pursuit. Those who had the largest trade must necessarily derive the greatest advantage from a better international regulation. He had no doubt that when England abandoned her old principle, the United Netherlands, and the other powers who were prepared to retaliate, would mutually concur in the new arrangement. He was prepared to hear from the hon. member near him (Mr. Robertson) that the proposed alteration would be prejudicial to the British shipping interest. In such an observation he could not concur; for he thought, on the contrary, that the shipping interest of this country had nothing to apprehend from that of other nations. The committee would recollect, that when the alteration in the navigation laws was projected, similar unfavourable anticipations were made by part of the shipping interest; but these anticipations proved in the result entirely unfounded. It was quite time to get rid of this retaliatory principle, which, if carried to the extreme of which it was susceptible, must injure every species of trade. One sort of shipping would be carrying the trade of one country, and then returning without an equivalent advantage, to make way for the countervailing regulations of another power, or else to return in ballast. What would the country think of the establishment of a waggon which should convey goods to Birmingham, and afterwards to return empty? The consumer would, he thought, be little satisfied with such a mode of regulating the conveyance of his merchandise. The consequence would be, that there must necessarily be two sets of waggons to do that work which was now performed by one, and that too at a considerable increase of price on the raw material. We were not able to carry on a 798 system of restriction, labouring, as we had been for some time, under many and unavoidable difficulties. Our trade and commerce, it was true, continued to revive rapidly; but they required that we should adopt every measure by which either could be fostered and improved. What he meant to propose was, that the duties and drawbacks should be imposed and allowed upon all goods equally, whether imported or exported in British or foreign vessels; giving the king in council a power to declare that such regulations should extend to all countries inclined to act upon a system of reciprocity, but reserving to the same authority the power of continuing the present restrictions with respect to those powers who should decline to do so. Some jealousy might perhaps be entertained, at vesting in the king in council such a power as that of continuing or removing a tax; but it should be considered, that here was no power of imposing a tax. All that the Crown could do in such a case, would be to continue a restriction where another power declined to act upon a system of reciprocity, or to impose a duty upon vessels belonging to another power, in retaliation for a similar duty imposed by that power. He knew that it intended the king of Prussia to abate his retaliation when England relaxed her regulations. Indeed he had the best authority, that of the Prussian minister in this country, for knowing that such was the intention. That minister had stated, in his note, the principle of his Prussian majesty to be, an admission, "that reciprocal commercial restrictions were reciprocal nuisances, prejudicial to all nations having reciprocal interests, and particularly to those engaged in extensive commerce: and that the policy of Prussia was, to substitute, in the place of reciprocal prohibitions, reciprocal facilities."—The right hon. gentleman concluded by moving:

1. "That it is the opinion of this committee, that his majesty be authorized, by order in council, to declare that the importation or exportation of merchandise in foreign vessels may take place upon payment of the like duties, and with the like drawbacks, bounties, and allowances, as are payable or granted upon similar merchandise when imported or exported in British vessels from or to countries in which no other duties are charged, or drawbacks, bounties, and allowances, 799 granted on the importation or exportation of merchandise in British vessels, than are charged or granted on such merchandise when imported or exported in vessels of such countries.

2. "That his majesty may be authorized by order in council, to direct the levying and charging of additional duties of customs, or the withholding of any drawbacks, bounties, or allowances, upon merchandise imported or exported into or from the united kingdom, in vessels belonging to any country in which higher duties shall have been levied, or smaller drawbacks, bounties, or allowances, granted upon merchandise when imported into or exported from such country in British vessels, than are levied or granted upon similar merchandise when imported or exported in vessels of such country."

§ Mr. Ellice
said, that agreeing as he did with every thing which had fallen from the right hon. gentleman, it was not his intention to enter into the details of the proposed measure. He rose solely for the purpose of repeating a request which he had made last year. He hoped that while the right hon. gentleman was taking off these restrictions, he would take care so to reduce the duties upon the materials used in ship-building, that the British might be enabled to compete with the foreign ship-owner. Take the article of hemp for instance. A duty of 9l. or 10l. per ton was perhaps not much when hemp was 96l. but now that hemp had fallen to 30l., or 40l. per ton, the duty was the same. He did not mean to say that the shipping of other countries were exempted from this duty, but only that care should be taken to keep the ship owners of this country on an equal footing with those of other countries, He thought also that returns ought to be made to the House of the manner in which this power was exercised by the king in council, and—

Mr. Huskisson.
—That forms a part of my measure.

§ Mr. Ellice
—Then I have nothing more to say.

§ Mr. Sykes
said, that when he considered; that this bill would go to the root of the naval system of Great Britain, and that under the law as it now stood, that navy had flourished and become great, he could not help recommending the utmost caution, before the proposed alteration was adopted. He hoped that, under the impression of such a feeling, it was not too much to ask the 800 right hon. gentleman to permit his bill to stand over until the next session, and to have it in the interim printed and circulated among the shipping interests, otherwise those interested would have no opportunity of being heard respecting their property. He also strongly recommended that government should attend to what had fallen from the hon. member for Coventry respecting a reduction of the taxes affecting the shipping interests, and also relax the excise system relating to contraband goods, to which he had adverted on a former night. There was another subject, which he hoped the committee on foreign trade would sift to the bottom: he meant the abominable charges upon British shipping in the shape of consulate duties; which, singularly enough, always decreased as the consul was situated near Great Britain, and increased according to the distance from the mother country.

§ Mr. Wallace
merely rose to express his general concurrence in the resolutions of his right hon. friend. He did not mean to deny, that the system of discriminating duties which this country had adopted had been of advantage, as long as foreign powers were disposed to submit to it; but now, when every country was desirous of affording protection to its own commerce, it was impossible that such a system could continue without producing retaliation. He was perfectly convinced that a system of reciprocity between this and other countries would be found to be the most advantageous that could be pursued. It would not change his opinion of the propriety of his right hon. friend's proposition, to find that it was opposed by the shipping interest; for, in the course of his official experience, he had found, that on every occasion when the ship-owners had come forward to oppose a public measure originating with the government, they were universally in the wrong. With respect to what had been said about the necessity of delay, he must observe, that if the measure was desirable at all, the sooner it was adopted the better. If the ship-owners were hostile to the proposed bill, parliament, be had no doubt, would soon be made acquainted with their sentiments; for he had always found them very ready to state their objections to any measure which had been proposed by him. He believed that the fears which had been expressed of the injury likely to result to the mercantile interest from carrying into effect the views of his right hon. friend 801 were perfectly groundless. The shipping of Great Britain was perfectly able to compete with that of any other country.

Mr. Robertson
opposed the resolutions, on the ground that, if carried into effect, they would increase the distresses under which the shipping interest at present laboured. He would prove, from documents in his hand, that the shipping interest was not in so flourishing a state as had been represented. In the period from 1821 to 1823, there had been a falling off in ship-building to the extent of 161 ships, and 122,000 tons. In the same period, there had also been a decrease in our navigation, to the amount of 732 ships, 129,000 tons, and 8,000 seamen. Such had been the consequence of the system recommended by political economists. The end of that system would be, to drive the trade of Great Britain into the hands of foreign countries. This was the only country in Europe which was abandoning the system of protecting duties. A few years ago, when America obtained some concessions from us, she wished to obtain similar concessions from France; but the French government would not yield a jot, and imposed a light duty on importations from America, who, in her turn, did the same with respect to France. The views entertained by the president of the Board of Trade might be favourable to the mercantile interests, but they were certainly prejudicial to ship-owners and builders.

§ Sir J. Coffin
said, that the hon. member who had just sat down, seemed to entertain serious alarms for nothing at all.

§ Mr. Ricardo
said, that the country was much indebted to his right hon. friend (Mr. Huskisson) for the enlightened views he had taken, and the measures he had brought forward, to improve the commerce of the country. Parliament had, at length, begun to find out, that restrictions on commerce were restrictions, not on other countries, but on ourselves. It certainly was a question of policy whether England should take off the duties without receiving reciprocal advantage from foreign powers; but, if foreign powers recognised the same liberal principle, there could be no doubt that the advantage to England would be double the advantage which any other country could derive from the regulation. An hon. member had said, that it would be to his personal advantage to second the principles laid down, but that personal benefits ought to be sacrificed for the good of the navy. Now, 802 with respect to the navy, he had no apprehension whatever. The state of that navy, the facility for building ships, the superiority of this country in that branch of art, the great capital and enterprise of the people, were so many securities, that the navy would not fall into decay. He hoped soon to see Canada deprived of the preference which she enjoyed in the timber trade, and placed, in that respect, upon the same footing as Norway and Sweden.

§ Mr. T. Wilson
rose, not to oppose the resolutions, but to express a hope that if the bill to be introduced should be found to operate injuriously to the shipping interests, government would repeal the duties which affected ship-building.

Mr. Marryat
said, he knew it as a fact, that the duties between France and the United States of America were reciprocal. All the British ship-owners complained of labouring under great disadvantage, and the loud complaints of that body were certainly deserving of attention. It was stated, that five-sixths of the carrying trade between Great Britain and America was carried on in American ships. Now, it was not too much for the ship-owners to expect, that all the disadvantages which the British government could remedy would be removed. He was of opinion that the duty on timber imported from the Baltic ought to be reduced; and with that exemption he would support the principle of the bill. The inconvenience under which the ship-owners laboured from the present system were striking. It was the duty of this country to act upon liberal principles, and to give way in some instances, in order to preserve the commercial interests of Europe, and of this country in particular.