HC Deb 04 April 1917 vol 92 cc1398-419

We have had a very interesting discussion, and I am sure we would have been glad if it had gone on longer. I have risen to draw attention to a matter which I believe to be one of considerable importance. If I were to adopt the practice which has been used on other occasions and to commence my remarks by a text I find it in the OFFICIAL REPORT of the 2nd of April, column 916, in the following question and answer: Sir William Byles asked the Parliamentary Secretary to the Shipping Controller whether the export of cotton piece-goods from the United Kingdom to India and Burmah can be accelerated; is he aware that there are 20,000 packages now awaiting shipment for Bombay alone representing a sterling value of £800,000; and whether, in view of the importance to national interests of this trade, the inadequate shipping facilities will be extended? The Parliamentary Secretary to the Shipping Controller (Sir Leo Chiozza Money): I am aware of the facts referred to by my hon. Friend, and I am glad to be able to inform him that steps have already been taken to deal with the congestion referred to. I am sorry to have to add, however, with regard to the last part of his question, that in view of the serious character of the tonnage position, it is impossible to make any promise that other difficulties of the same sort will not arise in the near future. I do not think that that question and answer have received anything like the amount of public attention which their importance demands. I would also like to tell the House what I think many of them must know, that my hon. Friend the Member for Salford (Sir W. Byles) only raised a small part of the question for this congestion and difficulty in the export trade applies not only to India and Burmah but to the Far East, China and Australasia. What has happened is this, that the ships which are engaged in these trades have been, by the orders of the Government, very largely taken out of those trades and placed in the North Atlantic trade. As far as shipowners are concerned, the present arrangements really makes no financial difference whatever. Certainly the ships have been used in a way which is not very satisfactory, because they are being put to unsuitable work, but that is not really a matter as to which I complain at all.

The seriousness of the position revealed by the answer I have read and by the facts as we know them, lies in the effect upon the export trade of the country, particularly the export trade of Manchester piece goods. It must be common knowledge that the best markets now open for Manchester, if they are not at all times the best markets for Manchester goods, lie in the more distant countries. I think I would be right in saying that India is probably the best market, with China probably second, and, of course, at present Manchester has lost the Levant. The markets are to be found in all the more distant voyages. If, therefore, the more distant voyages are to be prohibited by the Government or very largely reduced, it must necessarily follow that you have struck a very great blow at the export trade of the country. In all the discussions we have had with regard to the position of this country during the War, it has always been stated, and stated quite truly, that it was a matter of grave national importance to maintain our export trade. In the discussions about manpower, those engaged in this trade have been constantly classed as people who are doing work of national importance. I do not think anybody would be found to deny the very serious character from the purely financial point of view of any interference with the export trade. We want this trade in order to finance the purchases abroad which we are obliged to make to provide ourselves with the munitions of war. Indeed, those who manufacture goods for the export trade are really just as much making munitions as are the people who are actually engaged in doing so in this country, because the merchandise which is exported is used as a means of payment for the munitions which we bring from abroad.

The whole question of foreign exchanges must also be very seriously affected by a diminution in the export trade. I do not think, indeed, that anyone would be found to question the importance of the export business. If this export trade is going to be stopped, I would ask the House to consider what the result is going to be in our industry at home. I understand from a paragraph which I saw in the "Manchester Guardian" the other day that bankers in Lancashire are themselves seriously concerned as to the effect on their position which follows from the stoppage of the flow of exports. It must not be forgotten that all these goods that are going out of the country have had advances made upon them at almost every stage of their existence, from the moment that the raw cotton was shipped from America up till the moment when the finished goods are going to be sold to the ultimate consumer in foreign parts, and if you put a stop to the flow of those goods at any stage between the original fountain and the final destination then you put those whose business it is to finance the operation in a position in which they have advanced money which they have no reasonable expectation of ever being able to recover. The position of the bankers becomes an exceedingly serious one. As to the position of manufacturers, merchants, and brokers engaged in this trade, and of course the workmen who are employed in the factories, I think that speaks for itself. A general stoppage of the cotton trade of Lancashire would mean the most serious national disaster from the financial point of view. Other trades have had their exports prohibited or stopped, but that has been because the articles they made were required for domestic consumption. That is not true of the cotton trade, which is essentially a trade which manufactures for export, and only to a very moderate extent can the markets which may be lost, if what we understand is the policy of the Government is persisted in, be replaced by home consumption.

In regard to the trade both to India and China, I would like to draw the attention of the House to this fact, that the business of the Lancashire manufacturers will almost certainly be taken by Japanese and native Indian manufacturers, who are always hot competitors, and we must by no means disregard the possibility that trade which will be taken during the period of the War by Indian or Japanese competitors may not be recovered after the War. It is a very dangerous thing to introduce a competitor to your customers. I think the position revealed by my hon. Friend's answer to the question is most alarming, because it is quite plain that no Government would ever have taken the step of seriously curtailing their export trade unless they had found themselves, for other reasons, in a very difficult position. We know exactly, of course, what these ships will be used for. It is to bring food and munitions, and I do not complain of that being done because it is absolutely necessary that we should have food and munitions, but if we have got to such a stage that we can only get food and munitions by stopping our export trade, then I think we have a very sinister indication of the position into which the country has got. I do not know that one wants to emphasise the exact reasons why this state of affairs has arisen. It is a difficulty largely arising from the very great figure to which our Army has been raised—a difficulty which many of us prophesied would be the inevitable result of making the Army so large a portion of our effort in this War. It is a difficulty which has been further accentuated by the employment of the Army on distant expeditions. Those, indeed, are very largely the causes of this difficulty.

But what I want to ask from the Government on this subject is a frank and open statement of the position. I want them to put their cards, so to speak, before the public. I want to ask my hon. Friend whether it is part of the policy of the Government and whether they are contemplating a total prohibition of the export trade in cotton goods, because if they are contemplating anything of that sort it is quite plain that, first of all, the people ought to know it, and, secondly, that steps should be taken at once to prevent the importation of the raw materials necessary for the manufacture, for nothing can be worse for us than to have the export of this class of merchandise prohibited—-not prohibited in terms, but nevertheless in fact, by Government action—while all the time there is a steady stream of the raw material for these goods coming into the country. That can only lead to congestion and financial embarrassment. Whatever is going to be done in regard to this trade, the loss to the nation and the difficulty will be very much minimised if the Government will openly state their policy, and let it be a clear and consistent policy which people can work to. And, of course, as I pointed out just now, the financial position will be very much eased if we are not allowed or induced to import into this country raw materials which can never, during the period of the War, be worked up into finished articles and sold.

There is one point with regard to the departmental action of the Shipping Controller to which I wish to draw attention, and that is that in whatever stream the export trade is allowed to go one, however attenuated that stream may be, he should take steps to make it a regular stream. We do not want to have a large accumulation of goods, such as the hon. Member for Salford (Sir W. Byles) alluded to, kept waiting in our ports or -warehouses possibly for weeks and then let go as a flood. What we want is some arrangement by which there shall be a fairly even flow of the volume of exports, because if you do not have a fairly even flow you get congestion in every port, you get a dislocation of labour, you get a dislocation of every arrangement, and nobody is in a position to use any intelligence or to make any sort of systematic plan. It seems to me very necessary that the Government should put everybody connected with these trades in a position to work whatever business is left to them in a reasonable, intelligent, and economical manner. I would also point this out, that all these voyages, which are normally undertaken to distant places, bring back to this country commodities of very great value. If we do not know in advance what is the volume of shipping that is going to be allowed to leave this country for distant places week by week or month by month, no one can make any reasonable plan as to which of the valuable commodities—I do not mean valuable in the mere sense of money value, but valuable for national purposes- can be brought home and which can not. I do not wish to enter into any discussion of the situation in regard to tonnage, as to whether or no the decision of the Government is necessary or whether it could be avoided. What I particularly desire to do is to emphasise the seriousness of the position, because I do not think the importance of the step taken in, if not prohibiting, at any rate seriously curtailing, the export trade can very well be exaggerated. I invite my hon. Friend who represents the Shipping Controller to make a frank statement to the House and to let us know exactly where we are.


I do not know to what Department the questions that I have to raise belong, but to a large extent I represent the commercial community in this House. We have complained very seriously of the action taken by the Government in several directions. I know perfectly well that the nominal heads are not responsible because, as a rule, they do not follow details at all; but there is a strain to throw off and to hamper the trade of the merchants of this country. The last speaker, the Member for Hexham (Mr. Holt), has pointed out that the congestion in the exports of the cotton trade and the lack of tonnage is a serious matter. We know that there has been a great shortage of tonnage. It is generally agreed that the shortage is to be accounted for, in the first instance, by the gross mismanagement of the position some time ago. There are, however, other things of which the merchants are complaining. One is that preference in a great many cases is being given to our foreign competitors, and that British merchants are being left entirely to themselves without the protection from the British Government to which they are entitled. The last speaker mentioned the fact that in consequence of the prohibition of, or rather the inability of the Government to, allow the export of cotton goods from Manchester to India and China, that that trade will be taken up very considerably by the Japanese. That I know is what is taking place. The British Government are going to help the Japanese to capture the China trade and the Indian trade. Further, they are doing their best to help the Japanese to enter into a new trade—that is, the Persian trade.

The Government, to show hon. Members how the Government favour foreigners to the detriment of British merchants, made a prohibition of the import of certain articles in the month of December. The British Minister in Japan made representations to the Home Government that the British merchants were complaining that it would be a serious matter for them if they were not allowed to ship the goods for which they had contracted, because they had had to pay for them—and remember that many of them are comparatively poor men—and that they would be in the position of having these goods thrown on their hands and to have them waiting until after the War, when the markets may appreciate very considerably. They could get no satisfaction. They therefore went to the Board of Trade, and begged the Board of Trade to reconsider their decision and to help them out of their difficulties. It was of no avail. What was the consequence? British merchants in Japan had to go to their manufacturers, with whom they had made contracts, and had in some cases to pay a penalty, to get the contracts cancelled. The Japanese merchants approached the British Govern- ment through their Minister in London, and knowing that they were in a better position vis-a-vis with the British Government than the British merchants were, they, whilst negotiations were going on, took advantage of the position of the British merchants. Whereas the British merchants were having to cancel contracts, the Japanese were taking up the goods of the contracts that were being cancelled. The result of the negotiations was that the Board of Trade issued an Order. They had refused permission to the British merchants to ship beyond the date of their original prohibition. When approached, however, by the Japanese they extended the time till the end of April. The Japanese merchants were thus able to take advantage of this extension of time, which was not communicated at all to the British merchants. The first we heard of it was in telegram from Japan to say that the Japanese merchants were shipping whilst the British merchants had to look on. Again, the consequence was that the buyers in this country were asking for goods because the prohibition had been taken off. The British merchants went to their manufacturers and re-entered into contracts, sometimes at higher prices, to get the goods delivered. The merchants then took the opportunity to book their freights forward so as to be able to get the goods into this country, and the next thing that happened was that the Board of Trade undertook again to prohibit imports of goods into this country after 15th March, notwithstanding that they had given permission to import goods into this country up till the end of April.

I can only attribute the action of the authorities to the utter lack of commercial knowledge. Unfortunately in the public Departments we have nobody who understands the methods of carrying on the trade of this country or of the world. The consequence is that we get into the most fearful muddle imaginable whenever commercial matters are concerned. They never take the trouble to ask the advice of people who have commercial knowledge and experience. They very often go to their experts and to their theorists when they should go to practical business men. They have told the merchants now, in relation to the Regulation for the shipment of goods which had to be made before 15th March, that the prohibition means that the firms that have paid for their goods will be allowed to ship them, and those firms who have not paid for their goods must keep them out in Japan. Anybody—even the office-boy—knows that it is the custom of merchants in Japan to take advances from the banks and to make advances to the manufacturers to whom they give their orders, and the goods come in by agreement. They are constantly paying for goods, from day to day, and they keep them in their godowns until the shipping opportunity occurs. Sometimes, especially at the present time, when there is a scarcity of tonnage, you have to keep the goods probably for a month or six weeks. The hon. Member opposite mentioned cotton. I would ask the Board of Trade to remember that most of these goods will come by Japanese steamer.

The Japanese, although they are our Allies, are not going to give up their business for the benefit even of this country. The Japanese owners will keep their factories going in Japan, and if the goods are prohibited in this country because the Board of Trade, or the Shipping Controller, imagine that those ships will be devoted to bringing foodstuffs to this country, I can assure them that I know the Japanese, from an experience of forty-seven years in business, very much better. Those boats, if they are not allowed to bring Japanese goods to these ports, will take Japanese goods to the markets which have previously been supplied from Great Britain, and do a tremendous injury to the future business of this country. It is far better to let them bring a small proportion of Japanese goods here, so as to keep the. neutral markets for ourselves in the future, than to let them introduce their goods into those neutral markets to our detriment after the War. The Board of Trade have told the merchants in Japan that they can ship the goods to this country, and secure a licence, provided the goods have been paid for prior to the 15th March. So far as we are concerned, if an English house has paid for those goods in Japan before 15th March, that English house will not be allowed to have a licence to import them into Great Britain; but if a Japanese house has paid for them in Japan, the Japanese house is to be allowed to import them into Great Britain. If the British houses in Japan have to cancel their freight engagements, those boats are coming here just the same, but the engagements and the space vacated by the British merchants will be filled by their Japanese competitors, who will be able to take the profit, and the British houses will have to maintain their position of debtors to the banks who have advanced the money for them.

I have another and a serious complaint to make against some Department of the Government in consequence of their action in supporting foreign traders against British traders in different parts of the world. The British Government were requiring to buy coal, and they wanted to buy it in Japan, where, as everybody knows, there is very good steam coal. Nothing was said to any of the British merchants in Japan. There are houses in the coal trade who shipped coal long before the Japanese themselves thought of shipping coal and making a market abroad. The British Government—I have tried to find out which Department, but every Department denies having done anything in this business—bought considerable quantities of coal. I do not know what price they paid for it, but the first indication we had that they were buying coal was a tremendous rise in the price of coal in Japan. The first intimation we had as to the buyers of the coal was from our competitors when they asked us to let them have some coal for the British Government, as they had two boats in and had not sufficient coal to supply the requirements of the cargo. We naturally let them have the coal. We saw several steamers coming in, and, on inquiry, we found they were British boats sent by the Admiralty, but for which Department, of course, we could never find out. They were some of the boats chartered by the Admiralty, which at that time had control of the shipping. The British merchants were found again in the same position. The Japanese had the orders for this coal. They went into the market and bought up all the coal, and the price rose from about 12s. 6d. to 20s. in a week. I contend that it is the duty of any country to support the merchants of that country in whatever part of the world they may be. There is no Government in existence, I believe, except the British Government, that would ignore their own countrymen and place with foreigners the orders and the advantages of the trade with the Government. It really confirms what the present First Lord of the Admiralty said in this House in the Nigerian Debate. He said that you only have to be a British merchant not to be trusted by the officials. I do not blame Ministers, for they are never consulted, and know nothing about it. It is the permanent officials who have the entire control and management of these things, and there never was a truer word said in this House than that remark by the present First Lord of the Admiralty in the Nigerian Debate.

I will take another instance where the British Government are doing a serious injury. They are buying large quantities of stores in Japan for the Persian Gulf Expeditionary Force. Again they ignore the British merchants in Japan; probably they are not aware that there are such things as British merchants in different parts of the world. At any rate, they ignore them, and actually the Japanese knew nothing about the Persian Gulf trade until the British Government introduced them there. They have started a line of steamers. The Persian Gulf was one of the best markets for British goods before the outbreak of this War. We had certainly competition with the Germans. What did the German Government do? They started their own line of steamers to the Persian Gulf. They induced Germans to go there and establish themselves, and supported them in every way they possibly could. Yet we have the British Government deliberately introducing some of our most severe competitors into the Persian Gulf trade, because they will not trust the British merchants to represent them and to do their business. I should like to know which Department is responsible. Last year, when the discussion arose, the then President of the Board of Trade made some statements which were absolutely incorrect, and I told him then that the Commercial Department of the Board of Trade was about the worst informed Department there was in any of the Government offices. I can only attribute this to the fact that the Commercial Department is ignorant of the fact that there are British merchants in every part of the world whose integrity and honesty is proved by the fact that any foreigner will go to them in preference. The British Government have done nothing to assist British merchants in the Far East, and they have done rather less than the French, because when the French Government desired to buy things in Japan they went to British merchants, because they knew they could trust them implicitly with any orders placed in their hands.

Then there is the question of establishing a trade bank. I believe this is also a matter connected with the Commercial Department of the Board of Trade. We have heard that they want to establish a trade bank because it is considered that the facilities granted to merchants engaged in the commerce of this country are inadequate. I can only say that I attribute this to their utter ignorance of the commercial facilities, and the methods by which the business of the country and the world is carried on. Probably they have never heard of the numerous banks which exist for the purpose of carrying on the commerce of the world. Probably they have entirely forgotten that prior to the War the imports and exports of this country amounted to over £800,000,000 sterling, and they certainly must have omitted to inquire how that trade was financed. My experience has taught me that nearly the whole of that financing was done by British banks. There is the Hong Kong and Shanghai Bank, the Chartered Bank of India and Australia, the National Bank of India, the National Bank of South America, in fact, there are so many that it would be utterly impossible for me to go through all the banks engaged in financing the trade of this country to the extent of £800,000,000 a year, and who also finance the trade between India and the United States, Japan and the United States, and between Japan and India, and this trade would probably amount to £1,000,000,000. And yet to-day we are told that we have not the banking facilities, and that it is necessary to establish a new trade bank and a British trading organisation, although British merchants throughout the world have carried on the trade of this country with the world for generations. I think I can claim that British merchants have carried on that trade to the satisfaction of this country, and a large amount of what used to be called the invisible revenue of this country was attributable to the energies of British merchants in all parts of the world.

9.0 p.m.

When we are told that we want a new institution for the purpose of developing the industries of this country, I ask myself what sort of people can possibly have made such a suggestion. There is not one of the great industries of this country that could possibly establish a branch or an agency of their own in any country in the world because the business that is being done would not be sufficient to pay an agency. How the business is done is that the different industrial engineering firms and others interested in these trades go to the merchants, and some of those merchants represent perhaps twenty or thirty different industrials, and by that means they are enabled to get the orders for those industrials. I have seen in some papers that this new trade bank is for the purpose of imitating what is called the British and Chinese Corporation. That corporation has done fairly good business in China, but it has also caused this country to lose some very considerable orders and contracts. The reason why the British and Chinese Corporation have done so much in China is that they have a monoply of the patronage of the British Government to the detriment of all the British merchants who are entitled to the same assistance from the Government. The complaint has been made over and over again that the merchants in China could not get the assistance of the British Government.

I go back a few years to the time when the Germans were able to get considerable contracts simply because the British Government tried to force down the throats of the Chinese Government this British and Chinese Corporation, and my opinion is that the establishment of this trade bank is merely the result of a combination of manufacturers, the same as the British and Chinese Corporation, who represent a certain clique of manufacturers, and when that corporation gets an order from a railway the order goes to the one clique of firms, and nobody else is able to derive any benefit from that particular order. It is natural that, as you have no business men in our Government Department, they know absolutely nothing about it. They are entirely in the palm of the hands of these gentlemen who want to get into the position of having a monopoly of the Government support, and I am not attributing to them any other motive. The people in this Department know absolutely nothing about the matter, and a man goes to them and says, "We have not the facilities for this and that." They know nothing of what actually exists and probably care less, for they do not want the trouble, and all this is most injurious to the well-being of the commercial community. In China, where the British and Chinese Corporation is established, the Chinese Government would not have any-thnig to do with it for a time, and a firm of British merchants went to the British Minister, because the Chinese Foreign Minister told him, "If you bring a letter from your Minister that you are capable of carrying out orders given by the Chinese Government, we will give you the order for this railway." The British Minister absolutely refused any assistance, because he said they were bound to the British and Chinese Corporation. The British and Chinese Corporation was nominally supported by the financial group known as the Five-Power Group. A German merchant went to the German Ambassador, and said, "Will you give us a letter for the Chinese Minister, saying that we are capable of carrying out any orders entrusted to us?" The German Minister immediately gave the letter, as he would to any German subject, and when he was accused by the other members of the syndicate for having supported a German, he said, "I did what I always do for any German: he asked me for a letter, saying that they were capable. If they get an order for one thing or another it is not my business. They are quite capable to fulfil any contracts which they may take, and I felt justified in saying so, whatever the object of that letter might be."

I can tell you of dozens of cases, most outrageous cases, where the Departments have actually refused to give any assistance. I know of the case of a considerable concession where the foreign Government could not treat with a certain party who was being supported by the British Government. The British Government absolutely tried to force down their throats a syndicate with which the foreign Government would have nothing to do, and the concession was never granted to anybody, because the British Government would not support the people who were in a position to take the contract. I should like to know from the Board of Trade what the function of this new institution is to be. I want to urge, and I hope the House will support me, that this institution should not have the sole support of the British Government. Every British merchant in any part of the world should be able to claim and receive the support of the British Government, whatever this institution is to be. I think it is the greatest mistake for the Government to interfere in commercial matters of this kind. They are bound to make a mess of it, as they always do when they interfere with commercial matters. I should like to know what is to be the position of this new organisation, and I want an assurance that it is not to be a monopoly in all parts of the world and to have the sole support of the British Government. I hope the House will support me on behalf of the British merchants throughout the world, who have done such valuable service in the past for our country and for the Empire, and who are entitled to the support of the Government. The home trade of this country, amounting to over £800,000,000 a year, and the international trade, amounting to over £1,000,000,000 a year, has been financed in the past without a British Government institution or bank, and if the Government would ask any man who has practical knowledge of business matters they would learn that there is no need of any sort or kind for an institution of this description supported by a Government Grant.

Sir J. D. REES

Eminent City men have recommended it.


I should like to cross-examine them for five minutes. I would prove that they either know nothing about it or are interested in the monopoly. That is my opinion, and I am prepared to support it, and even to go better. We have had this Italian Bank in regard to which there appears on the Estimates a sum of £60,000 guaranteed by the Government, and I should like to know what sort of business it is doing, because certainly there is no very great need for it. We made representations to the Shipping Controller, to the Food Controller, and to the Board of Trade with reference to the trade in dates in the Persian Gulf, of which about 30,000 or 40,000 tons are shipped in September. I pointed out that the merchants in the Persian Gulf had to make advances in March, April, and May so as to secure the product for shipment. I asked the Department whether they were going to allow dates to be imported this year and whether one could get a licence for a steamer. The complaint is that the licensing of steamers last year was not very fairly done. The present Controller had not been appointed at that time.


Would my hon. Friend mind explaining what he means when he says that the matter was unfairly dealt with?


I will come to that presently. I want to put on record that whereas the price of dates in normal times is 16s. per cwt., it is now 47s. 6d. In normal times they are sold at from 2id. to 3d. per lb. on the barrows of the hawkers; this year they are being sold at 8d. and 9d. per lb. by the grocers. Last year my firm applied for a licence for certain steamers to load with dates in the Persian Gulf for London. The steamers went out on Government time charters, and the owner told us that they had been released on condition that they loaded with wheat at Bombay or Karachi. They gave one steamer, because I threatened to make a row. I want to know what is going to happen this year. Are the Government going to prohibit the importation of dates? They ought to do so, because dates are not necessary. Dates now are 47s. 6d. per cwt., and are sold retail at 9d. per lb. You can import sugar and retail it at 6d. per lb. A third of the weight of dates is stone, and I ask the hon. Member who says that they are good food—which a poor man would wish to have: I lb. of dates at 9d., or I lb. of sugar at 6d. That is the question which has to be decided. The hon. Member for West Ham (Mr. W. Thorne) last year asked why a British boat was licensed to load a cargo of dates from the Persian Gulf to the United States. He was told there was too big a stock in the United Kingdom. When you have the price put up from 16s. to 47s. 6d. a hundredweight I do not think there is any plethora of dates in the United Kingdom. I want to find-out from the Board of Trade or the Shipping controller or the Food Controller what action they are going to take. Are they going to devote 30,000 or 40,000 tons of shipping to bring dates to this country at 47s. 6d. a hundredweight to be sold at 9d, a lb., or are they going to devote that tonnage to the transport of sugar to be sold at 6d. a lb. or of flour? My firm has put in an application for a licence for a steamer to load in the Persian Gulf, and I want to know, if any licences are granted, whether we shall have the first preference to a licence and that it will not be given to the ring. It is very difficult to get anything out of any public Department. We are told we must not speak in the House of Commons of any business in which we are interested, but I have ventured to break that rule, because it is very evident that if people do not talk of what they know it is difficult to get a question ventilated. I am not alone in these things, mere are thou- sands of other merchants, consequently I raised these questions to-day so that we may know exactly where we are.


The hon. Member who has just sat down has touched upon a large variety of subjects into which I do not propose to follow him. With regard to the last matter to which he referred, at one and the same time he is urging the Government to prohibit the importation of dates into this country as an unnecessary luxury, while requesting me to tell him whether he can have a licence for a ship in the coming months to import those dales into this country.


What I said was that you ought to prohibit the import, but that if you are going to grant a licence, I claim to be first entitled, because I asked for it first.


I will leave my hon. Friend to reconcile those two statements.

Mr. DEPUTY-SPEAKER (Mr. Maclean)

I do not think I ought to allow that to pass without any comment. It is a very remarkable exception to the general rule that an hon. Member should rise in his place and discuss the action of a Minister of the Crown in a matter relating to his own private business.


After what you have said, Sir, I will pass from that particular subject, and address myself with very great pleasure to the exceedingly moderate speech with which the hon. Member for Hexham (Mr. Holt) brought before the House a subject upon which he is not only well qualified to speak, but which is of the very greatest importance at the present time. I welcome the opportunity he has given me of dealing with that particular matter. During the period of three years in which we have been engaged in this great contest the conditions of war have radically changed the normal character of our external trade. They have profoundly modified its direction, and the present Government, like its predecessors, has been compelled to proceed from step to step in an endeavour to make the shipping of this country of the greatest possible value to the country, in view of those rapidly changing conditions. That is a task the seriousness of which it is impossible to exaggerate. As the House well knows, for a considerable period those in charge of this matter found it sufficient to requisition a number—a gradually increasing number—of those roaming vessels which are familiarly known as tramps. They obviously offered the most convenient field of operations in the attempts that were made to readjust tonnage to the conditions of which I have spoken. But lately, as the tonnage position has grown more and more in seriousness—I am sure my hon. Friend and the House will acquit the Government of any desire to conceal the seriousness of the situation—it has become necessary to extend the area of requisition. I indicated, in a brief speech I made in the House a few weeks ago, that we have had to take into consideration and to attempt to readjust the established lines of communication which have been set up by the enterprise and skill of British shipowners during a period of many years. As I said three weeks ago, the area of requisition has been greatly extended. Since my right hon. Friend the Shipping Controller took up his great task, I suppose that well over 1,000 more vessels have either been brought under actual requisition or are now under notice of that requisition.

When I state that fact the House will realise how drastic are the steps which have been taken since the Ministry of Shipping was formed. Included in this great number of vessels are over 800 cargo liners trading on well-known and well-established lines of communication throughout the world., As the House will readily understand, in dealing with this subject imports have to be our first consideration—imports for the purposes of the War and imports for the purposes of the civilian population. When it comes to that consideration, it most unfortunately, as I shall show presently, has to be taken into account that a vessel which trades to far markets occupies upon its voyage a much longer period of time, and therefore in a given time can bring into this country only a much smaller proportion of imports than if it is trading to a near market. That is an obvious consideration which hardly needs to be stated, but it is necessary for the purposes of my argument to remind the House of it. What are we doing? In brief, this: We are to a certain extent, combing out—to use an expression with which we have become unhappily too familiar—of some trades a proportion of vessels in order to bring them into near trades.

If we represent by the figure I a vessel trading to Australasia or the Far East, it counts as two or rather more than two, for the purpose of imports if it is trading to South America, while if it trades across the North Atlantic, either to the Dominion of Canada or the United States, it counts for four or more than four. I give these figures as very near approximations to the case, but of course in practice they may be less or more than that in particular cases. Taking the whole of our ships, and supposing for a moment that we divert them from far trades to near in order to get the largest quantity of imports into the United Kingdom, then theoretically every three of our ships become four. That is a theoretic statement which obviously may not be realised in practice, because handling the tonnage of a ship on paper is a different operation from handling the good ship "Mary Ann" proceeding from one port to another. But still that is a theoretical statement which broadly represents the truth, that 3 tons becomes 4 tons if taken in the way we are endeavouring to do it. Therefore, in a position in which our tonnage has diminished and is diminishing, in a position in which every week finds us with fewer ships than in the week before, it is our obvious duty to follow the course which I have outlined and to have regard first to our imports. So far good. But note the consequences. First note the effect on the lines themselves. Putting aside the particular arrangement which has been made, we in effect go to the old-established line running to Australasia and we take out of it a proportion of its ships and bring them nearer home to perform shorter voyages, and therefore give us more imports. The effect of that, of course, upon the line itself is mischievous. We do not disguise from ourselves the consequences of these things, but we are compelled to do them by the exigencies of the times, and we do not hide from ourselves that we are inflicting injury upon old-established businesses. It is the unfortunate necessity of our case.


I did not complain of that.


I quite understand that my hon. Friend did not complain of the fact. Then there is another consequence which we regret fully as much, and it is that if we take a ship out of the service of, say, the Dominion of New Zealand or the Commonwealth of Australia, we to a certain extent injure the export trade of that Dominion or Colony. That is another unfortunate consequence that has to be faced, that we are compelled to limit the shipping facilities of our own Dominions when they happen to be far markets. At the Ministry of Shipping the other morning we had the great pleasure and advantage of a conference with the representatives of the Dominions now in this country, and all these things were clearly put before them, and I need hardly say were accepted by them in that spirit of patriotism and self-sacrifice which has all along marked the relations of the Dominions with the Mother Country in this War. Still there is the unfortunate fact that has to be faced again of loss to a British Dominion which we do not desire to inflict, and which it hurts us to inflict. The instance was mentioned at Question Time of our Indian possessions, where we get an unfortunate limitation of their exporting power, because of this necessity of limiting their shipping facilities in order, in time of war, to add to the total shipping facilities of the Empire.

Then I come to the third loss—our own loss. If we restrict the importations from far markets it follows, not necessarily, but usually, that we restrict our exports to those markets.


I understand that at the moment our best markets for exporting are the far distant markets.


Yes, and that, of course, is a most important part of this aspect of the subject. We limit our exports to these far markets, and in many cases those far markets are most valuable, as in the case of the cotton trade, and if we get our imports from a near market it does not build up or cause to arise more exports to those near markets, and therefore we are losing the export trade of the far market without any corresponding gain in the near market from which we are compelled by circumstances to draw our imports. That is the case, crudely stated, but fortunately there are mitigations. First, our imports, of course, are still, as they were in the past, very much greater in volume than our exports, and that of course is a mitigating fact. It may well be that, even although you have to cut off a certain amount of imports from a market, you do not in the same proportion cut off your exports to that market, and it must be remembered that we are not taking all the ships out of any trade but only a proportion of the ships. Then there has been an actual fall during the War of the quantity of our exports to certain of these markets, and really they have been over-served by ships in many cases up to this time. There has been more outward space offering to lift cargoes than there have been cargoes to lift. That is another mitigation of this particular point. But still, when that is said, it is impossible to deny that there is something in the case made by my hon. Friend that you get dislocations, you get loss, and you get loss falling upon trades which it is your desire and your interest to cherish as far as they can be cherished. The particular case of cotton is one which it would ill become any Government Department to neglect. I think I may say of the conduct of the Ministry of Shipping that we have not been unmindful of the needs of that great trade and we have not acted blindly in this matter or without due and proper consideration. So far as the immediate congestion was concerned we have been able to relieve it. Naturally Lancashire will be interested in the answer to this question what of the future? It is not, fortunately or unfortunately, possible to give a decisive reply to that question. I wish it were. It is not possible in a war like this to measure the future or even the near future precisely. I can only say that we are endeavouring to do that. There is certainly no contemplation of the prohibition of cotton exportation. We are endeavouring to arrange a regular service of steamers, the capacity of which will be made known quite frankly to those interested in the trade so that they can enter into commitments accordingly. With respect to my hon. Friend's further question whether, however attenuated the stream of this trade may have to be, we shall see to it that even if it is attenuated it is made regular, the answer is most positively in the affirmative.

Sir J. D. REES

Does that apply to Nyasaland?


The same remarks apply mutatis mutandis. It is impossible to say what the near future will bring in these matters. I can only say this, that the endeavour is being made to map out the trade of this country in the world and to provide that both as to exports and imports the best is done with the tonnage. Of course, the trade can help us, as it has helped us already, by making known to us and keeping us constantly in touch with its particular needs and its particular difficulties. We have already had the advantage of receiving a deputation from the Manchester Chamber of Commerce on this particular subject, and I have every hope that by keeping in touch with that body and with the trade we shall, at any rate, be able to do the best for them with the available tonnage. I will say a word on the whole question of the relations of imports and exports at the present time. As the House knows, it has been necessary very seriously to restrict imports in the national interests, and the Prime Minister recently announced a long series of restrictions designed, as I explained the other day, not to limit imports, because they are limited in any case, but to give the country the imports it wants instead of the imports it does not want. Last year we brought in 43,000,000 tons of cargo. Merely to give that figure is to make one wish one could put back the hands of the clock and bring in 43,000,000 tons only of goods that are essential. If that could have been done, our difficulties at the present moment would have been very different from what they are. We have imposed drastic restrictions, and for the rest I may tell the House that we are endeavouring to survey the whole field of imports in relation to the tonnage which is estimated to be available during the remaining months of this year and to form, as it were, a balance-sheet month by month of the available tonnage and the cargo that can be carried, and, on the other hand, to set against it the demands for imports, ascertained by a co-ordination of the requirements of the different Departments of the State, supplemented by the civilian requirements of the nation. In that way we hope effectively to arrange an order of priority of imports so that whatever cargoes can be brought into the country will be cargoes most useful to the country. Whatever attempt is made to forecast the future and to provide for eventualities we are not able to prevent the possibility of dislocation from time to time, and I can only beg the House to believe that, so far as the Minister of Shipping is concerned, every endeavour will be made to make this dislocation as light as possible, and to give notice, so far as may be, of any changes that have to be made. I cannot pretend that a statement of this kind in these circumstances can be regarded by the House as satisfactory. Nothing is satisfactory in war, I suppose, except the winning of it. Certainly the means have to be taken and the exigencies and contingencies that have to be met cause us to resort to all kinds of expedients—sometimes unheard-of expedients. I cannot, therefore, expect the House to regard this statement as altogether satisfactory. I can only ask the House to believe that we are doing our best to meet circumstances of an unexampled character.