§ Motion made, and Question proposed, "That the Clause stand part of the Bill."
§ Colonel GRETTON
I want to know whether under this Clause it is the intention of the Government to set up a Customs barrier on the borders of Northern Ireland. Sub-section (1) deals with the making of regulations with reference to the importation and exportation of any goods into and from Northern Ireland, and regulations for the purpose of safeguarding the revenue and preventing and regulating the importation and exportation of prohibited and restricted goods. I take it that prohibited and restricted goods relate mainly to arms and explosives, but it is not clear what the Government mean by safeguarding the revenue. How will they safeguard the revenue by this Customs barrier? It is clear that the goods subject to Customs duty will be such articles as tea, sugar, alcoholic liquors and matters of that kind, and no doubt Customs duty will have to be charged upon those articles as if they were imported into any port in the United Kingdom when sent across to Northern Ireland.
There is another Clause which raises a question of greater difficulty, namely, the excisable goods sent to Southern Ireland which are afterwards sent across to Northern Ireland. Large quantities of goods are sent from Southern Ireland to Northern Ireland, and I would like to know what the Government propose to do under this Clause with regard to these matters. The Government propose to safeguard the revenue, and clearly it follows as a corollary that similar action will have to be taken in other parts of 596 Great Britain. Therefore there will be a new Customs barrier set up by the Act under this Clause between the Free State and what was the United Kingdom. I am not quite sure that the Government realise how far this Clause really carries them. These are all matters which arise directly out of this Clause, and I think this is the proper time to ask the Government what they mean by inserting this provision and how they propose to carry out the conditions set down for safeguarding the revenue, and regulating the importation and exportation of prohibited and restricted goods.
There is another further question which will have to be dealt with. There is not the slightest doubt that under Article 12 of the Treaty Northern Ireland will elect to remain part of the United Kingdom. The boundary between Northern and Southern Ireland is of a most irregular character. The Customs harrier to which I have referred is subject to provisions under the Treaty. A boundary will have to be arranged, and it will be found that economic conditions will have to be taken into consideration. At present the boundary is over 200 miles long, and if economic conditions are to be taken into account there must be some considerable modification of the boundary in order to make it more convenient to administer the economic conditions arising out of the Customs duty. I do not propose to pursue this question any further, but I ask some Member of the Government to explain what is meant by this Clause, and how it is proposed to put it into operation.
Mr. HILTON YOUNG
I want to supplement the remarks of the last speaker by asking one further question in connection with this Clause. Clearly this land boundary, the first and only Customs boundary by land in the British Isles, will be a very expensive matter to administer, although it is hoped that, by some of the powers taken in the Clause for defining the routes for the entry of exports, the expenses may be diminished. As I understand it, under the present financial settlement between Great Britain and Northern Ireland, there is an allocation to Northern Ireland of the contributions of Customs Revenue. The question I want to ask is this. Will the extra expense—possibly a very substantial amount—of the maintenance of the 597 land Customs boundary between Northern and Southern Ireland be brought into account against the revenue attributable to Northern Ireland, or what other arrangement in respect of the allocation of that burden is to be made between the two Exchequers?
§ Mr. PRINGLE
The hon. and gallant Member for Burton (Colonel Grebton) has spoken of this Clause as a very unusual arrangement. Under the Clause we are told that the Commissioners of Customs and Excise are empowered to make regulations with reference to the importation and exportation of any goods into and from Northern Ireland, in the event of an Address being presented to His Majesty as prescribed in Article 12. They will make the regulations on the basis of the existing boundary. They may arrange for places for purposes of importation, but they may set up a network of machinery which, when the Boundary Commission makes its Report, may be rendered totally obsolete and useless for the new condition of Ireland. I would suggest that it is premature to take any steps until the Boundary Commission has reached a decision as to the final boundary between Northern Ireland and the Free State, otherwise a great deal of expense may be incurred and the whole of the machinery may have to be scrapped. There is another point in connection with this, and that is as to the working of the preferential tariff. It is a very interesting point. We know that under the Budget of the right hon. Member for West Birmingham (Mr. A. Chamberlain) in 1919 great credit was given to the right hon. Gentleman for carrying out a policy with which his father's name was associated. It was a very poor thing to associate with the name of the late Mr. Chamberlain, but, nevertheless, it was put forward on that basis. Preference is given under it in regard to certain existing duties. I assume if those preferential duties are applied in relation to goods exported from the Free State either into Northern Ireland or into Great Britain, it will require a considerable amount of discrimination on the part of the Customs Authorities. There are sundry things to encourage the production of which in Ireland great efforts have been made, and I hope that either the Attorney-General or the Under-Secretary for the Colonies will be able to give us some information as to what it is proposed to do on this point.
§ Sir D. HOGG
The answer to the first questions asked by the hon. and gallant Member for Burton (Colonel Gretton) is that Clause 4 is a machinery Clause and nothing else. As soon as the Irish Free State comes into existence it becomes a separate Customs entity altogether, and therefore it is essential that some provision shall be made for some Customs frontier between Southern and Northern Ireland, because if none is made, dutiable articles which went into Southern Ireland paying, possibly, no duty, would come into Northern Ireland without duty and then be passed over to this country. As soon as we make a contract with the Irish Free State under which they become a Customs entity with a separate tariff and separate provisions as to Customs, it becomes necessary to provide some machinery by which we can levy the duties which are imposed by law on such goods as come into Great Britain and Northern Ireland by the land frontier. This Clause 4 only enables the Customs to set up such machinery as seems best fitted for carrying out that necessary purpose. The provisions they have in mind are set out in paragraph (b), which prescribes the places where the entry of goods imported or exported shall be made, and they will be able to fix the hours at which they shall come in. It is essential to have some such provision, but the exact details are left to be worked out by the Customs authorities. I need hardly assure the Committee that in setting up these Regulations they will have regard to the most economical way of carrying out the object which we have in view. Then it has been suggested by the hon. Member for Penistone (Mr. Pringle) that we should do nothing until the Boundary Commission has rectified the boundary. I venture to think that the Committee will realise that that is a wholly impracticable suggestion. It would involve this, that until the Boundary Commission had been set up and had reported, all goods coming from Southern Ireland into Northern Ireland would come in duty free, because there would be no one to collect the duty.
§ Mr. PRINGLE
Why not continue the existing temporary arrangement with the Provisional Government? I suggest that a temporary arrangement be made with the new Irish Government until the boundary is settled.
§ Sir D. HOGG
We have an arrangement with the Provisional Government under which the taxation for the current year remains as it was before the Provisional Government was set up. We have taken power in the Bill to make arrangements with them for continuing that in whole or in part, but we have no guarantee that they will see fit to do that, and it would be impossible to leave this country in the position that there was no power to erect any Customs frontier along the whole of the land division between Southern and Northern Ireland. At the same time Southern Ireland would become a Customs entity, and it might prove to be a fruitful field for enterprising persons who want to smuggle in prohibited goods without the disadvantage of a Customs examination. There are certain things, drugs for instance, which by law we have power to exclude from the Customs, and I think it would be very undesirable if through lack of machinery we left an open door by which such goods could pass over the frontier. The object of the Clause is merely to enable us to set up the necessary machinery, and I think it will; the Committee will see that that is what it does.
Mr. HILTON YOUNG
I am very much obliged to the hon. and learned Gentleman for answering my questions, but I think he did not fully apprehend what I wanted to know. No doubt the Customs people, with their usual efficiency, will reduce expenses to the greatest possible extent, but, nevertheless, the expense will be exceptional in comparison with that of a sea front Customs boundary. Is it possible to give the Committee any information whether the whole expense of the land Customs frontier between Northern and Southern Ireland will be brought into account against the revenue attributable to Northern Ireland?
§ Sir D. HOGG
The answer to the question put by the right hon. Member for Norwich (Mr. H. Young) is to be found in the First Schedule of the Bill. In Clause 4, Sub-section (3, b), it is provided thatin ascertaining the net cost to the Exchequer of the United Kingdom of reserved services the Joint Exchequer Board 600 shall have regard to any increase of expenditure thereon which may appear to them to be attributable to the establishment of the Irish Free State and shall make such allowance in respect of any such increase as may appear to them to ho just.The Committee will remember that in the Act of 1920 the cost of the reserved services is charged against Northern Ireland, and it is for the Joint Exchequer Board to assess the proper contribution of Northern Ireland to the Imperial Exchequer. The paragraph I have quoted enables the Joint Exchequer Board, in ascertaining the cost, to make such allowances as appear to be just in respect of any increase. That, I think, is a complete answer to my right hon. Friend's question.