HC Deb 20 March 1923 vol 161 cc2513-22

Motion made, and Question proposed,

" That this House do now adjourn."— [Colonel Leslie Wilson.]


I rise to ask for a sympathetic hearing from the House for a statement on the Nottingham lace industry to-day. It is a very difficult and complicated question of trade that I have to tell the House, and it makes my task the more easy to think I shall be heard and, I hope, helped, by the right hon. Gentleman the President of the Board of Trade who has just, if I may say so, delighted us with his constructive handling of a great economic problem. The plight of the Nottingham lace trade to-day may be estimated by a few simple figures. In 1913, at a time of normal output, the export trade amounted to £4,142,000 odd in value. In 1922, after a period of prosperity in 1919, which waxed and waned, the exports had sunk as low as just under £2,000,000, and when the alteration in the value of money is taken into account, the difference is really very striking, for in 1922 the index figure was up between 75 and 90 per cent. over the pre-War figure. and so it may be said that the value of those exports in terms of the 1913 currency was reduced to something not very far above £1,000,000.

11.0 P.M.

The exports in 1913 went principally to the United States, the British Dominions, Central Europe, including Germany, and South America. Therefore, the reasons for the falling off of the export trade in 1922 are not very hard to seek. In the case of the United States of Amerca, you had, and still have, an almost impassable tariff barrier. In Central Europe, you have a condition of almost complete inability to purchase, owing to the conditions of the currency. In the case of Germany, so I am informed, you have a tariff barrier which, if not technically an embargo, amounts in effect to an embargo, and in the case of South America you have fluctuations of currency and general financial instability to such an extent that a great amount of the stocks to that part of the world have never been sold. I have very little doubt that the representative of the Government who does me the honour to reply to these few remarks will tell me that the hope for the Nottingham lace trade lies in the revival of exports. Taking the long view, that is probably true. I have very little doubt that the export trade is capable of revival, and that, with proper encouragement, it will certainly revive, but I will ask the Government to consider that this revival, taking into account the places in which we have to seek our markets, must necessarily be a lengthy process, and, meanwhile, if the industry is not to perish completely, we must look elsewhere to carry on.

May I briefly indicate what was, and what is, the import situation? In 1913, I think it would be correct to say, that Notting ham was not greatly concerned with the home market. I do not mean to imply that manufacturers neglected their home market—far from it—but they were working full pressure for foreign markets. Indeed, they were doing so brisk a trade that they were making lace machinery for other countries, and in the meantime the French and Germans were obtaining a considerable footing in the London market. In 1913 the imports from France were just over £1,000,000, and rather more than that amount was imported from Germany. In 1922 the imports from France came to £1,250,000, and, of course, there was practically nothing from Germany; but by 1922, owing to the collapse of the foreign markets, it had become absolutely imperative, if the Nottingham industry was to continue to prosper, or, indeed, to carry on at all, for the Nottingham manufacturers to make an effort to capture the home market. What was the situation? By 1922 the French exchange was fluctuating in the neighbourhood of 60 francs to the pound, sometimes a little higher, and sometimes a little lower. The consequence of that was that whereas British costs of production had advanced, roughly, in the proportion to the index figure of living, that is to say, had increased from 75 per cent. to 90 or 100 per cent. above pre-War costs, the French lace, owing to the depreciated currency was selling in this country at only about 16 per cent. above the pre-War selling price. The consequence obviously was, and obviously is to-day, that it was, and it is, impossible to capture for the Nottingham industry a home market in which French lace is selling at less than the cost price in London

I would like to give an illustration to show that this is no exaggeration, by quoting an advertisement that was pub- lished in the "Observer newspaper in February of this year. It is not an isolated instance. There have been a number of these advertisements published. It is a well-known firm of merchants in London advertising a sale of laces, the stock of a Paris wholesale house, and it is said: This remarkable purchase was effected at an average discount of 75 per cent. Owing to the sensational fall in the value of the franc, the proprietors of this Paris lace house "— that is, the house from which this particular purchase was effected, decided to turn their stock into cash without delay in order to avoid further depreciation. Our cash offer was accepted, and on Monday we shall place on sale the first portion of the stock. Then we are told what the lots are to be. Lot I is a certain kind of lace— " To-day's Paris price, 15 to 20 francs per metre. Sale price in London per yard, 6¾d. Lot 2 is a different kind of lace— To-day's Paris price, 20 to 30 francs per metre. All to be sold at per yard, 1s. 3d. So this catalogue of laces proceeds in a large number of lots, disposing in all of 150,000 metres of French lace. It must be quite clear upon that, that no lace manufactured here, with the costs that prevail in this country, could conceivably hope to compete in the London market with that.


May I interrupt the hon. Member to ask if we are to understand that the hon. Member is claiming for this industry some measure of protection?


If the hon. Member will have the courtesy and kindness to allow me to develop my argument in my own way, he will doubtless become aware, before I have finished my speech, of exactly what proposals I have to make to the Government for the recovery of this industry. That is the situation with regard to the disadvantage at which this lace stands in relation to the French-made article. That has produced some very alarming figures with regard to unemployment. According to the information I have, it is estimated that in 1913 there were something like 50,000 lace workers employed in the Nottingham industry. My informants tell me (and my informants arc reputable lace manu- facturers in the City of Nottingham) that it is doubtful to-day if it would be possible to trace more than about 20,000 of these workers, because in these lean years a very great number: have been dissipated and have disappeared, and they tell me that of those 20,000 which it might be possible to trace, it is doubtful whether more than 10,000 are in employment. It is a very serious situation. The figures of the Minister of Labour certainly show that not more than about 2,000 of these unemployed or out-of-work lace hands are registered in the Exchanges. But I think my friends on the Treasury Bench would perhaps admit that these figures do not really give an accurate picture of the situation which seems to me—I do not want to exaggerate —to be appallingly grave. Seventy-five per cent. of the machinery in Nottingham is idle to-day and that is the reason the petition was presented this afternoon by my hon. Friend the Member for South Nottingham (Lord H. Cavendish-Bentinck) supported by my hon. Friend the Member for West Nottingham (Mr. Hayday) and myself—a petition praying for relief signed by 17,000 signatories. That petition asked that this industry should be scheduled under the Safeguarding of Industries Act. That is not an Act of which I approve, but it must be admitted that the claim is far more than a mere Protectionist move on the part of a few manufacturers. I am satisfied it is not that. It is a movement that has practically the whole of the Nottingham lace trade behind it. There was an immense meeting on 3rd February last in Nottingham attended by more than 3,000 masters and men, and you have this monster petition signed by 17,000 people.

Much as I dislike the Safeguarding of Industries Act, I must say that, if ever a trade qualified by the circumstances of unfair competition due to depreciated exchange, to ask for help, it is the lace industry of Nottingham. The situation as I understand it is that the Government has refused the application, because this is not the first occasion on which relief has been sought. Deputations have been received by the President of the Board of Trade, and, if I may say so, they were very sympathetically received by him—and I think the right hon. Gentleman will probably tell us there are a variety of reasons which impelled him to refuse this appli- cation. One reason—which I must say seems to me a cogent reason—he gave me, by implication, in answer to a question I put to him. The Act provides that it should not be applied to a case where its application would contravene commercial treaties or understandings with other Powers, and the reply to my question— at least, I so understood it—was that there existed a tacit understanding between this country and the French which would be contravened by scheduling this industry under that particular Act.


I should not like the hon. and gallant Gentleman to be under any misapprehension on that point. The case was rejected entirely on its merits, because the total imports into this country, coupled with re-exports, were wholly insufficient to justify, apart from any other consideration, the case under the Act. That is set out fully in the reply.


I am grateful to the right hon. Gentleman for giving me that information at this stage. What I would say to him and the Government is that if they can assist other industries to get on their feet again to compete against the fluctuating foreign exchanges and particularly against the severely depreciated foreign exchanges, they ought not to refuse assistance of some kind to this particular industry. The right hon. Gentleman says that he has refused this particular application because, in the view of the Department, it does not come within the four walls of the Act, and that the facts do not justify it. That may be so, but surely it is admitted that the situation in relation to unemployment is so grave and the falling away of the whole trade is such that it justifies us in going to the Government and asking for sympathy and help.




We will not refuse to welcome any scheme the Government can suggest, and even sympathy. In default of anything else I should like briefly to put to the right hon. Gentleman one or two points which I think are worthy of consideration. This country is at the present time paying a large sum of money, quite unproductive, in unemployment benefit to the lace trade. The workpeople in that trade are losing their skill, and day by day the men are becom- ing more unlit to resume their occupation. [An HON. MEMBER: "And the women"] Yes, and the women. That money is not fructifying, not being turned into capital. I submit to the right hon. Gentleman that this money, if infused into the trade, might perhaps prove some stimulus which would enable the trade to restart—or, at any rate, would go some way towards it. It would, too, enable the industry to compete against the incoming foreign lace and would help the industry to hold on to the coming trade revival, which, we hope for, and which the right hon. Gentleman and his colleagues encourage us to hope for.

I am told that if some such sum as £500,000 a year—which is not greatly in excess of the amount now paid in unemployment benefit—could be found, the lace trade could hold its own and keep all its machines working half time, and re-employ all these hands. The use of the unemployment benefit for such purposes would go a long way towards producing such a sum, and I suggest that if the Nottingham lace trade saw some such movement on the part of the Government, some gesture of help towards them. they might possibly be able to raise themselves, by loan or by private means, the necessary balance to carry out the scheme. The question is how to utilise such money, if it were available. I quite see that it would be impossible to give it to individual firms. It would be necessary to treat the industry as a whole, and my proposal would be that it might be possible to set up a Lace Control Board on the same lines as the Cotton Control Board which was set up during the War. That Board would be composed of employers, workers, and Government and, possibly, municipal representatives. It would fix the prices through the industry, because there are several processes all the way through, allowing no more than a small profit. It would arrange to cut costs to a minimum, and then it would be in a position to deal direct with the merchant houses who put the lace on the market; and, upon their producing the accounts of their losses at stated intervals, it could use that money to reimburse them for their losses in competing in the market with the lace that comes in from the Continent at this low price owing to the depreciated exchange. I realise that the Government could not pledge themselves to this scheme offhand, but it has been discussed with the representatives of the industry, and I think that I am accurate in saying that they believe that some such scheme could be carried out if the Government would accept it. My earnest hope is that the President of the Board of Trade will be able to see his way to consider some such scheme.


The hon. and gallant Member has not exaggerated the unfortunate position in which this industry finds itself. It is undoubtedly extremely serious, and I believe it to be more so than is reflected in the unemployment returns, because many persons who were employed in it have gone into other industries where their skill is not utilised to the same advantage. He has also stated with considerable accuracy what is the cause. It is entirely due to the failure of this trade to export anything like the proportion of its commodities that it used to export. Before the War something like 80 per cent. of the products of this trade were always exported. That rate of export has fallen very considerably. It is true that the industry made an application under the Safeguarding of Industries Act. and I went into it with the greatest care, but it could produce no evidence that would justify me on the facts in sending it to a Committee. It was apparent that the disaster was due to the failure to export. The actual imports into this country were considerably less than before the War, and over 80 per cent. of the actual imports were being re-exported. Such a case would not be met under the Act, because, even if an Order had been made, the trade would have gained little or no benefit, and it was plain that there was no primả-facie case which would in the least justify me —I can only administer the Act strictly— in sending such a case to the Committee. It would have been a wrong action on my part, and, indeed, of thankless benefit to the lace trade, which would have been put to the expense of going to the Committee with a hopeless task in front of it. It is true that nothing except an improvement in the export trade is likely to improve the industry. Anything that the Government can do within the powers at its disposal it is most anxious to do. I have discussed with the trade on several occasions the possibility of utilising export credits, and I have discussed with them other plans which might be adopted for promoting the sale of their commodities in different countries, and any assistance in any of these directions we can give we shall be only too glad and anxious to give.

With regard to the scheme which the hon. and gallant Gentleman has outlined, naturally he will not expect me to pronounce upon it, and as it relates to unemployment insurance, I would ask him to discuss it—if he has a scheme ready in a form in which it can be discussed— with my hon. Friend the Parliamentary Secretary to the Ministry of Labour; but. I am bound to point out to him certain initial difficulties in the way of the scheme, which is attractive at first blush. In the first place, it is no good going into a scheme of this kind, unless the money which could be raised would be sufficient to meet the difference in price, unless there would be an organisation which would be competent to do this job, and unless the whole trade would be ready to consent to it. Even if these conditions were fulfilled I am bound to point out these further difficulties. In the first place, such a scheme would require legislation. There is no power at the Ministry of Labour to do this under the Insurance Act. Secondly, although I cannot now elaborate this, the hon. and gallant Gentleman is aware that the Government recently went very closely and sympathetically—because they wished to do this thing if it were possible—into the whole question whether it would be possible to use any part of the Unemployment Insurance Fund for this purpose. We published the result of our deliberations in that matter, and I think the hon. and gallant Gentleman is familiar with them. There are, apart from the statutory difficulties, a great many further practical difficulties in the way. Even in spite of that, I am so anxious that no stone should be left unturned which can in any way assist this industry, that I am sure my hon. Friend the Parliamentary Secretary to the Ministry of Labour will be very glad, if a scheme is in a state in which it can be discussed, to go into it with a desire, if it is at all possible, to do anything by that means, or some other that may be suggested, to help the industry.


Does not the right, hon. Gentleman think that the position is not only very serious for Nottingham but is also reflected in the cotton spinning trade of Lancashire, and that it justifies strong representations being made to the United States that they ought not to put up such severe tariffs against our goods as will prevent us in a great measure, and in a reasonable way. from meeting our engagements with them?

Mr. SPEAKER has, in pursuance of Standing Order No. 1 (Sittings of the House), nominated Sir George Croydon Marks (in the room of Lieut. Colonel the right hon. Sir John Gilmour, Bt.) to act during this Session as a temporary Chairman of Committees when requested by the Chairman of Ways and Means.


Does not the right hon. Gentleman think that the real remedy is to adopt a general tariff which would enable manufactured goods to be prevented from being dumped here?

It being Half-past Eleven of the Clock, Mr. SPEAKER adjourned the House without Question put, pursuant to the Standing Order.

Adjourned at Half after Eleven o'Clock.