§ Order for Second Reading read.
§ MR. J. L. RICARDO
said, this Bill had only been placed in the hands of Members at twelve o'clock that day—consequently, they had had but little time for its consideration. The Government had to-night passed a sufficient number of Bills relating to finance to satisfy the most inordinate appetite for such measures, and he hoped they would afford sufficient time for its discussion. He regretted to observe, that when the right hon. Gentleman moved the Resolutions relating to the sugar duties the other night, he did not mention the most important principle which they contained. The trade was therefore taken entirely by surprise. Under these circumstances, he asked the Government not to proceed with the Bill before Whitsuntide, in which case no opposition would be made on the present occasion.
§ MR. J. WILSON
said, the objections to which his hon. Friend alluded were objections not to its principles, but to details, which could alone be properly considered in Committee. He therefore proposed to state the general views of the Government with regard to the measure now, especially in relation to some points on which differences of opinion existed; and then to read the Bill the second time, after which, if the House considered that any good would arise from delay, he should have no objection. At the same time he must observe, that already complaints were made of the inconvenience to which the trade was at this moment exposed, from the uncertainty which still hung over the Resolutions to which the House of Commons might arrive, and he would therefore now proceed to state the views of the Government on the subject. The objections to the Bill were not of the nature which in previous times had often been made to measures of this description. The old principle of protection was no longer contended for, and therefore it was unnecessary for him to say anything in relation to that principle of the measure which contemplated the immediate equalisation of the duties on sugar, from whatever country it might come. The only objection 1125 which he had heard to the principle of the Bill, was that taken by the hon. Member for Ashburton (Mr. Moffatt) relative to the introduction of the proposed scale of qualities in fixing the duties. No man was more alive than he to the disadvantage of any change in the mode of striking the duties upon articles of general consumption; and he wished it were in his power to suggest any measure by which the grave objection to this course in commercial quarters could be got rid of, because it would not only simplify trade, but it would give just encouragement to those who manufactured a fair article in the best manner. The Government were fully alive to the justice of the complaints they had received from the producers of some of the most deserving and improving qualities; and he admitted that those manufacturers in the West Indies who had introduced vacuum pans, and in the East Indies who had adopted improved processes of making sugar at a great outlay of capital, had some right to complain, if by discriminating duties this country gave encouragement to the manufacture of an inferior article. But as long as there were discriminating duties, it was impossible to levy a single duty on all sugar except refined sugar; and if refined sugar alone were excluded, there would soon be sugars manufactured equal to it in quality which would have to pay the lower duty only. The only other proposition for distinguishing the various qualities of sugar was that for refining in bond. But in that case there was, in addition to the discriminating rates, a still more important objection to the proposition—namely, its interference with an important article of trade by an Excise duty. There was no alternative, therefore, but to adopt the medium course between both as the lesser of two evils—a plan which, though not perfect, was the most perfect that could be applied to the case. It was the intention of the Government, consequently, to prohibit for the future all refining of sugar in bond, as it was essential to have one uniform system under which all refineries should be placed. The discriminating duty being abolished and one uniform duty imposed, there existed no longer any excuse for refining sugar in bond. It was the intention of the Government, therefore, to repeal those clauses in the Customs Act which empowered the Commissioners of Customs to grant licences for refining on bond. The terms proposed to enable bonded refineries 1126 to become free refineries were these:—It was proposed that bonded refineries at present in business should proceed with that business until the 26th June; and that after this they were to receive no more raw sugar for refining. They would then be allowed to work up the produce in hand until the 2nd July, and from that until the 5th July they would be allowed to place their manufactured stocks in bonded warehouses in the docks, on the same terms as refined sugar imported from abroad. It was proposed then that stock should be taken on the remainder left in the various processes of refinement after the 2nd July, and that the duty should be levied on it as on the raw material. And it was then proposed that from and after the 5th July, the duty on this stock being paid, they should be allowed to work from thenceforward as free refineries. There was another important question then to be considered—namely, the drawback. It would become, under these circumstances, necessary to provide for the foreign export trade in refined sugar; and it was therefore proposed to allow a drawback in proportion to the qualities of the article exported. But as the sugar trade was at present in a state of transition, and the qualities exported were becoming much more various than they had been, it was impossible to fix at the present moment the amount of the drawback. It was therefore proposed to confer power upon the Queen in Council to vary and increase the drawback as might be required by circumstances. As regarded drawback it was an essential principle to the sugar trade that it should be fixed upon strictly equitable principles. While refining in bond existed, drawback was more nominal than real. If, under the new system, drawback was made too large, it gave a solid bounty to the British refiner; while if it was made too small, it placed him in an unfair position with regard to the competition with the refiner of Holland and Belgium. Therefore, although a certain amount of drawback was stated in the Bill, he (Mr. Wilson) was not prepared to say that there would not, as the result of an investigation now going on, be some slight alteration in the rates. There was one point of importance to the sugar trade to which he should refer—one on which he believed there would not be such general concurrence on the part of the planters as he expected with the other propositions in the Bill. The Government had been 1127 frequently asked to permit the use of molasses and sugar in breweries as well as in distilleries. At present, both were used in distilleries; but the reason of the permission in this case was obvious, as the Government had the machinery of the Excise to bring to bear upon these establishments. Any difference of duty which existed between sugar and malt might be accurately ascertained and assessed. But this was not the case with breweries. There were 40,000 licensed breweries and brewers, and though the Excise had the power of entry into these breweries whenever they liked for revenue purposes, practically, however, they had no kind of supervision over them. Several deputations of parties connected with the West India interest had recently had interviews with Government, and had pressed the question on their careful consideration. The question had received careful attention, and the result that had been arrived at was, that it was impossible to permit sugar or molasses to be used in breweries. There was a difference of duty of 5s. 3d. per cwt. between sugar and malt; therefore it was clear, so long as there was this large inducement of 5s. 3d. per cwt, to the brewers in favour of using sugar instead of malt, that the 40,000 brewers, added to the thousands of wholesale grocers in the different towns, would avail themselves of this inducement, and that loss must consequently arise to the revenue, unless, indeed, 10,000 excisemen were employed to protect the revenue against fraud. The effect of this result upon the sugar trade was larger in theory than in fact, for on inquiry he found that but very little was used in breweries. He found that in one year not more than about 800 tons were used out of a total of 400,000 tons of sugar, and that last year the amount used was 720 tons out of a total of 470,000 tons of sugar. So that while he very much regretted the necessity there was to allow this restriction to remain, yet, from the small amount of sugar used, it would inflict no great hardship on the sugar trade, while great injustice would be done to the maltster. With regard to the two classes in the sugar trade, the refiner and importer, most affected, he would state the case in a very few words, and endeavour to set forth the claim the refiner had to indulgence. The case of the refiners was stated by an hon. Gentleman to present a clear case of a claim founded on justice on this ground. If reduction in duty on the raw 1128 material were made, and if reduction of the duty of the manufactured article were made at the same time, the manufacturer was exposed to unfair competition in consequence of the preference thereby given to the foreigner. No one could deny, as an abstract proposition, that such would be the case. That point was pressed on the attention of Government last Session. It was admitted by Government to be unequal and unfair, and that had these things been pointed out to Government at the time, provision would have been made to meet them; but as the refiners, though aware of the circumstance, did not take any steps, it was fair to assume they did not attach much importance to the matter. From the Jamaica sugar-growers Government received a deputation; they pressed their case on the attention of Government, and Government admitted the justice of their claims. It was impossible to tell what transactions would have taken place, if the Act of 1848 had taken effect in July. When the right hon. Gentleman the Chancellor of the Exchequer made his financial statement on the 8th of May, it was the intention of Government that the new duties should take effect on the following morning; and hon. Gentlemen would please to observe, that had this determination been carried out, no inconvenience would have been sustained or injustice done to any party. But the right hon. Gentleman the Chancellor of the Exchequer eventually determined to postpone the drop on the duty on foreign sugar to the 16th of July, six weeks after the 8th of May, and this had caused the difference which had since become a question for consideration. The right hon. Gentleman, it would be recollected, had also passed a Resolution adding 15 per cent to the duty on refined sugar. The Resolution now submitted to the House varied the original proposition in order to do justice to the refiner, without unnecessary inconvenience to the importer. The Resolution passed the other night was stated at the time to be passed subject to reconsideration. There were two points to consider—the time, and as to the amount of difference between the two duties. From time best information that could be obtained from persons in the trade, six weeks was at first fixed upon as the best that could be suggested. At the same time he was bound to say it was generally anticipated that the sugar duties must be dealt with in the present Session, not only as regarded refining in bond, but 1129 as regarded better discriminating duties. That was what was wished by both parties; and no one could say, even if they disagreed with the conclusion to which Government had come, that great pains had not been taken by Government to do justice to all parties; and if Government should have arrived at a conclusion that might not please one or the other party, yet both parties might say they had been fairly heard, and that due attention had been paid to what they had urged. With regard to time, it appeared, from all the inquiries that the Government had made under the circumstances of the case, that six weeks was a longer time than would be necessary for the purpose of the refiners and the Government thought that, in order to enable them to accommodate their price to the new rate of duties, a period of four weeks would be abundant. With respect to the amount of the duty, the Government considered that it would be a fair arrangement if the duties were allowed to stand now exactly as if they had passed on the 8th of May—that was to say, that the duty on foreign sugar should be 16s. permanently, but that the 17s. 4d. duty should remain in operation four weeks after the 5th of July. He thought, upon the whole, therefore, if they reduced the period from six weeks to four weeks, and if they allowed the 17s. 4d. duty to stand without the addition of 15 per cent, as originally proposed, that that arrangement would form a very fair compromise between the refiners on the one hand and the importers on the other.
§ MR. MILNER GIBSON
said, he had received many representations from his constituents in reference to this Sugar Bill, and stating that people were at a loss to understand why the difference of duty upon foreign refined sugar and foreign raw sugar should be so constantly changed. They were told in 1846 that this difference should be 3s. 4d., and now it seemed that the permanent difference was to be turned into 5s., but that for the next four weeks it was to be 6s. 8d. If 3s. 4d. was the right figure in 1846, it was clear that 5s. could not be right now. There were great complaints of the constant fluctuations that took place in the proposals of the Government as to what was to be the duty on foreign refined sugar and on foreign raw sugar. He confessed himself unable to comprehend the hon. Gentleman's complicated statement. He hoped that the proposition of the hon. Member for Stoke- 1130 upon-Trent (Mr. Ricardo) would be agreed to, and that the second reading of the Bill would take place now upon the understanding that the Bill should not go into Committee until after Whitsuntide.
§ MR. THOMSON HANKEY
hoped the House would not consent to the proposal for postponing the further discussion of this Bill. The delay that had already occurred had caused great inconvenience to the trade, and further delay would only add to the grievance of the sugar importers and refiners. The Resolutions had been proposed ten days ago by the Secretary to the Treasury, and there was no new principle involved in the arrangement now proposed; so that all parties had had ample time to consider the measure, and the only object of further delay could be to obtain another modification in the terms.
§ MR. J. L. RICARDO
said, that his request to the Chancellor of the Exchequer had been entirely misunderstood by the Secretary to the Treasury (Mr. Wilson). What he (Mr. Ricardo) had stated was, that he was prepared to move as an Amendment that the Bill be read a second time that day fortnight, unless the Government would consent to defer going into Committee until after the Whitsuntide holidays. Everything that had fallen from the Secretary to the Treasury, and particularly his statement of the successive alterations that had been made in the original plan, only proved the reasonableness of his (Mr. Ricardo's) request for delay.
was surprised at the proposition of the hon. Gentleman (Mr. Wilson), for, from the confident tone and the clear case he made out for his proposition, he certainly thought that the hon. Gentleman would have adhered to it. But from the portion of the hon. Gentleman's speech he had been able to hear, he thought he collected that the hon. Gentleman had abandoned his position. Where were they to stand, he begged to ask? In what position were they to consider themselves placed, if these alterations and changes were to take place so rapidly and so constantly. He had had some conversation with home sugar refiners on the question; and had been told by them that the proposals made by the Secretary of the Treasury on Friday were perfectly acceptable to them. It was with some astonishment that he understood that the hon. Gentleman had now come down with another proposal. if the Government had been wrong 1131 at first and now sought to correct their mistake, at all events time ought to be allowed to the trade to consider the altered proposal. He hoped the Government would act fairly as between the home and the foreign refiners, leaving totally out of sight the class of speculators.
§ THE CHANCELLOR OF THE EXCHEQUER
said, that as something had been just mentioned by the hon. Member for Stoke-upon-Trent (Mr. Ricardo) as to a Motion to postpone the second reading of that Bill for a fortnight, he must remind the House that this was not properly a Bill for the adjustment of particular duties relating to trade, but a Bill of Ways and Means, and to grant to Her Majesty the necessary supplies for carrying on the war. Therefore, it had not been moved in a Committee of the House on the Customs Acts, as all Bills with respect to trade usually were, but as a measure of Ways and Means. Under the circumstances the House would see that it was a Bill that had a financial character much more than a commercial one, and a political character more than either. The subject of the sugar duties certainly arose in the course of considering this question, and all those who had had practically to deal with those duties would know that they were a matter of extreme delicacy; and therefore he would suggest to hon. Members that the points they had to state should be treated as questions for the Committee on the Bill, and submit that the reprinting of the measure was no reason why the second reading should be postponed. As to the time for going into Committee, the Government were entirely impartial on that point, and had no desire but to fix the Committee at a time that would be most convenient for the parties interested. Last week it had been represented to him by a numerous deputation that it was of the greatest consequence that this matter should be speedily settled; and under these circumstances he thought the House would act most wisely if it allowed the Bill to go into Committee on Friday next, because he believed that everybody concerned in it in the country was perfectly aware of the general bearings of the subject; and there would be ample time before Friday for the interchange of opinions and the making up of their minds as to the course which hon. Members should pursue. That was the course which he should advise; but at the same time, if it was the wish of the House that more time should be given, he had no 1132 objection, on the part of the Government, to naming the first Thursday after the Whitsun recess, instead of Friday next, for going into Committee.
§ SIR WILLIAM CLAY
hoped the Chancellor of the Exchequer would persevere in his intention to take the Committee on Friday next, as already there had been time enough lost, and no ground had been stated for further delay. The tendency of prolonged uncertainty was to paralyse the operations of the trade.
After some discussion,
Bill read 2°.
Motion made, and Question proposed, "That this House will, upon Friday next, resolve itself into the said Committee."
Amendment proposed, to leave out the words "Friday next," and insert the words "Friday week," instead thereof.
Question, "That the words 'Friday next,' stand part of the Question," put and agreed to.
Main Question put, and agreed to.
Bill committed for Friday next.