HC Deb 29 April 1926 vol 194 cc2261-88

Question again proposed, "That the words proposed to be left out stand part of the Question."


It strikes me as extraordinary that a party professing to take a strong stand for Empire trade, which lives electorally on "Buy British Goods," should be guaranteeing a loan of £2,000,000 for a Greek electrical scheme, and handing over the work to a French firm.

There are even more extraordinary illustrations of this Empire policy that we do not hear so much about. On the 23rd of February this year my hon. Friend the Member for Saint Helen's (Mr. Sexton) asked the Chancellor of the Exchequer whether or not it was the case that the Government had guaranteed sums of money, admitted afterwards to be over £1,000,000, to a shipping company called the Silver Line, and whether or not it was the case that it was a purely American concern, and that the Silver Line were actually using this guarantee of public money to trade with their American boats against British ships. The Chancellor of the Exchequer admitted the facts, and declared that there were other occasions upon which these reactions upon British trade could be more profitably explored. But there it was— we were guaranteeing Yankee shippers more than £1,000,000 in order to compete with British interests.

Here is an even more extraordinary instance than that, and I trust I shall have the attention of the hon. Gentleman the Secretary for Overseas Trade upon this, because it vitally interests him. The constituency which I jointly represent with another Member is the city of Dundee, which lives very largely upon jute manufactures. By going through the Annual Statement of Trade of the United Kingdom for 1924— the volume for 1925 is not yet issued— I find a contrast between the imports of jute goods coming from Holland in the year 1921 and the imports in 1924. In 1921 we imported from Holland £57,000 worth of cordage, cable, rope, twine, etc.; in 1924 the figure had risen to £142,000. Imports of jute sacks and bags rose in the same period from £568 to £19,086; jute manufactured goods from £2,000 to £63,000; and jute carpets and rugs from Czechoslovakia rose from £3,000 to £178,000. I submit there is something here requiring explanation. What is the reason of it? I tumbled across a part of the reason quite by accident. I discovered the British Government subsidising the English Beet Sugar Corporation— note the word "English, 'because it is the only thing English about it— and I found that the leading light in this English Beet Sugar Corporation is called Van Rosen.


A good English name!


Van Rosen's head-quarters are in Amsterdam. I discovered that they had ceased buying jute bags in Britain for their sugar. Though they take public money as a subsidy to develop the sugar-beet industry at Cantley— last year they got £360,000 from the British taxpayer by way of subsidy for one factory at Cantley— they have ceased to buy their jute bags in this country and buy them in Holland. Then I began to inquire who ran the jute factory in Holland, and I ran up against our friend Van Rosen. Then I submitted questions to the Clerks at the Table about this, but apparently there are some Regulations which I contravened, and I cannot get my questions accepted. Then I went to the hon. Gentleman the Secretary of the Overseas Trade Department, and with his customary willingness to help, and his anxiety to extend the usefulness of his office, he agreed at once to inquire as to the labour conditions. That is what I am primarily interested in— the labour conditions and wages under which these jute bags are manufactured in Holland in competition with those manufactured in Dundee. Is the competition fair? Because, if it is, then it is obvious that the fault lies with the manufacturers of jute goods in Dundee, and it is along other lines that tariffs or prohibition that we must act. The hon. Gentleman replied that he made inquiries in Holland and got into touch with the Commercial Attaché at The Hague, and the Commercial Attaché reported thus. I would ask the House to listen to it. It is a gem. I am not blaming the hon. Gentleman, but he has got to begin sacking somebody if his office is to be of any use. Mr. Zaalberg informed me to-day that Messrs. Terhorst and Company "— Terhorst is Van Rosen— at Rijssen had no permit for over hours, and that 48 hours was the usual working week. As regards wages, he stated that he had no particulars of the wages paid in Messrs. Terhorst's factory, but that this firm paid the usual textile wages in Twenthe. He further stated that these wages were based on certain basic minima and that their calculations were intricate. And because the wages were based on certain basic minima and their calculations were intricate, he was sorry he could not tell us what they were.


What is wrong with. it?


Well, if the hon. Gentleman can make no further observations upon a situation like that than "What is wrong with it?" he will get up against very, very serious trouble in the occupation of his office. We want to know the labour conditions under which these goods are produced.


My staff got that information at a few hours' notice in order that I might have it available to give to the hon. Member. I told him if he would give me a week or so I would make fuller inquiries and find out more than I could find out in a few hours.


As a matter of fact, I gave the hon. Gentleman several days. I am not blaming the hon. Gentleman. I distinctly said so. I said he had put the machinery of his office into operation. What I am saying is that his representative at The Hague tells him he cannot get the information. I could send a trade union organiser to Amsterdam and get this information in 48 hours. I think we are entitled to know the conditions under which goods are produced, especially when they are being subsidised by British money.

Hon. Members opposite say "Let us have Imperial preference: that is the cure." Are they prepared to give Imperial preference to goods produced under the British flag when those goods are produced under sweated conditions? I have here a case of a Nottingham firm which set up a boot factory at Port Elizabeth in South Africa, which pays its half-caste labourers 2s. per day, and produces boots and shoes which crushes us out of the market. Is the hon. Gentleman prepared to say that we ought to give preference in our markets to goods produced under those conditions? I have another case here of pineapples and pears bottled in South Africa, where wages are 6d. per day. Ought we to give a preference to goods produced and handled under conditions such as those? I say "No." We say that we ought to have a clear examination as to the labour conditions under which the goods are produced. That is the policy of the party on these benches. I call to remembrance of the right hon. Gentleman the President of the Board of Trade that when his lace goods proposal was before the House last year an hon. Member for Sheffield moved, and I seconded, an Amendment that no preference should be given to lace goods coming into Great Britain unless it could be shown they were not manufactured under sweated conditions. It was amazing to me that Members opposite voted in the Lobby in favour of the importation of sweated goods into this country.

While I say that, however, I am not blind to the fact that there are great possibilities for British trade under decent conditions in the British Empire. We have Australia working a 44-hours' week and paying a minimum wage of £4 5s. a week, and competing as best she can with dried fruits from Smyrna We would not deal with that case by taxation; we would deal with it more rigorously than that. In Scotland last year the Bakers' Union, when they discovered the conditions under which these Smyrna fruits were being packed, as a result of the investigations undertaken by my hon. Friend the Member for North Southwark (Mr. Haden Guest), passed a resolution asking their members never again to handle these goods, in the interests of the health of the people. That is the most effective way of dealing with the sweater; but they found themselves up against the fact that Australia could supply our market with only 10 per cent. of our requirements, and, consequently, the Bakers' Union in Scotland had to depart from its resolution.

There is one other interesting figure I got out of the Trade Returns to which I do not think public attention has been drawn. In 1925 the total West African purchases of British produce and manufactures were valued at £14,000,000. According to the "Statesmen's Year Book," the population of West Africa is over 21,000,000 British exports to West Africa work out, therefore, at 12s. 6d. per head per annum of the people there. British exports to the United States of America work out at only 9s. 3d. per head; so that, per head of the population, the West African Colonies are a better market for our goods than is the United States. Why is that? Whom have we to thank for that? We have to thank the late George Cadbury for it. George Cadbury and several other cocoa firms used to buy their cocoa beans in the slave plantations of Portuguese West Africa. The late George Cadbury protested against the slavery being employed there, and as he could not get any satisfaction he organised the other cocoa firms in Europe. They instituted a rigid boycott of further purchases of cocoa beans from Portuguese slave territories, and they ordered them from the freer producers on the Gold Coast, with the result that the Gold Coast is now prosperous and able to buy 12s. 6d. per head of our goods as against 9s. 2d. per head in the United States. I think that alone proves that there are more efficacious means of promoting trade, and it shows that if we do our utmost to increase the purchasing power of our own people, and prevent this international traffic in sweated goods, that is the best way to deal with it, and that is the official policy of the party to which I belong.

I know the ex-Chancellor of the Exchequer can be considered as an extreme Free Trader, but I think we are all agreed that there should be through the League of Nations a stop put to this international traffic in sweated goods. This has been done in regard to cocoa beans, woodwork, and other industries, and when the Government makes up its mind to use the machinery of the League of Nations and declare that henceforth any nation which violates its own signature to the Washington Convention like Japan has been doing by selling prints at prices which even the Indian peasants cannot purchase and with which the Indian worker cannot compete — so long as that state of things is going on, I beg the right hon. Gentleman the President of the Board of Trade to get a move on in regard to a new policy. Let him go to Geneva and tell the representatives of those nations which are violating their signature to the Washington Convention, that this kind of thing cannot be allowed to go on any longer and that if it is not put an end to there will be a rigid boycott of their goods. You will by that means raise the purchasing power of the working classes all over the world, and at the same time you will abolish sweating. You will then have taken the only possible steps you can take to abolish this extraordinary amount of unemployment from which every industrial city is suffering in this country. Unless you improve the purchasing power of your customers we shall always have poverty.


Is it not a fact that those countries with the highest wages and higher purchasing power all over the world have protective tariffs?


I believe that India has got protective tariffs, and there are other countries which have got them where the wages conditions are bad, but what I am suggesting is that the mere carving out of the world into little water-tight compartments is of no use. You want an international regulation below which no producers will be allowed to work, and, if any of those producers do not observe the regulation, then every other civilised nation in the world should boycott them.

The PRESIDENT of the BOARD of TRADE (Sir Philip Cunliffe-Lister)

We have just listened to a very interesting speech from the hon. Gentleman who has just sat down. I shall not, of course, attempt to reply to all the points he has raised, because if I did I am afraid I should be trespassing in the region of questions which involve legislation. What I will say, however, is that we both seem to be seeking the same ultimate object, but I think he ought to carry his investigations a little further than he has done. Many of us differ in our fiscal ideas as to what is the best way to attain a particular object. What you have to consider is how far any means which seem at first attractive are actually practicable. I think if the hon. Member for Dundee carries his investigations a little further he will find that whatever practical difficulties offer themselves in regard to the present policy, the difficulties of prohibition are much greater.

Anybody who considers proposals for a tariff or duty, whether it be general, or particular, or prohibition, is inevitably driven to the conclusion that whatever may be the shortcomings of duties, the practical difficulties of prohibition are infinitely greater. To a country with a world trade it is vitally important to consider the Empire trade, but we can never shut our eyes to the importance of our world trade. I would like to point out to the hon. Member for Dundee that, to make his system of selective prohibition effective, he would have to denounce almost every commercial treaty to which this country is a party, and that would be a very serious thing for the world trade of this country.


The proposals I put forward have been set out in very great detail in a pamphlet signed by members of the committee.


I have read the pamphlet referred to with great interest and care, and it is a great relief to find not only the rank and file but even some leaders as well have strayed so far from the path of fiscal propriety as to support those suggestions. It is the policy set out in that pamphlet that I have considered with great care, and I am bound to say, after careful consideration, that that policy could not be carried out without a denunciation of those Treaties. I do not propose to follow those proposals of the hon. Member for Dundee further, although at the present moment criticisms have been made from both sides of the House in regard to alternative policies, what does emerge from this interesting debate is that there is a general con-census of opinion in all quarters of this House as to the great importance of using whatever means are possible in order to develop trade within the Empire. That is indeed a wise conclusion for this House to arrive at.

Whether we look at the general trend of trade, or at the particular advantages which have arisen from our Empire trade we are inevitably driven to the same conclusion. It was estimated by the Balfour Committee, a year or more ago, that while we were doing about 25 per cent. less export trade than pre-War, we were on the whole getting about the same share of any export trade that was going that we were getting before the War. It is not an easy calculation to make and I should think probably last year we were doing rather less than our pre-War share of all the export trade of the world. Roughly speaking, in 1913 we were doing about 13 per cent., and last year we were doing perhaps about 11.9 per cent. of the world aggregate of export trade. It is not a very easy calculation to make, and the position probably is not as bad as it appears. We have no separate figures of manufactures as distinct from foodstuffs and so on for last year. Nevertheless, there certainly is a tendency in the world to import a larger amount of foodstuffs, and there is more export trade generally in foodstuffs all over the world. In 1925 there were great exports of grain, some of it at very high prices. I do not, therefore, attach undue importance to the figure, but I think that to-day the position is certainly better. It is one of the relatively satisfactory aspects of our improved trade that, whereas in years past we have seen a flicker of hope coming in our exports by an improvement of trade in October and November, in the new year it has died away.

In the first quarter of this year, for the first time, we see that advance has been steadily maintained, and the first quarter of 1926 shows a definite increase in the export of British manufactures over the general average for 1925. Even so, the first quarter of 1926 only sees us export between 82 per cent. and 83 per cent. of the volume of manufactured exports which we exported before the war. On those figures there is still a great need for expansion in our export trade, and particularly in regard to manufactures.

We cannot look for any quick increase in our exports to Europe where there are two factors which will undoubtedly militate against any rapid expansion. The first is that there is a greater industrial productive capacity in Europe to-day than there was before the War, and European countries, while they are poorer, are more able to meet their own requirements in the shape of manufactured goods.

In the second place while it is true that the return of Europe to stability and sound finance and to a gold standard is unquestionably in the long run a guarantee that Europe will be more prosperous in the future, and be able to purchase more, it is inevitable that during the period of a return to stability there will be hard times and a contraction and restriction of credit, and that means that while Europe is getting back stability, she must economise her credit and consequently will be able to purchase less from this country. Therefore, more than ever we are driven to the necessity of developing new markets, and particularly the markets of the Empire. It is interesting to see that we are already in part succeeding in this endeavour. It is interesting to note how the proportion of our total exports to the Empire has grown. I have taken out, and hon. Members will recollect that I have published regularly in the "Board of Trade Journal," the distribution of our total trade in our different markets, showing, for every principal market in the world, what is the proportion of our total trade which went to that market before the War, and the proportion that is now going there year by year; and, similarly, where our import trade is coming from.

In 1913, before the War, our exports to the British Empire represented 37.2 per cent. of our total export trade. In 1920 that had fallen to 34.2 per cent. The House will remember that 1920 was the easy year, the year when you could sell anywhere, and you could cancel a contract and take up another; and it is to be remembered that, whether one looks to our present experience or whether one looks to the past, to any time in British industry between 1875 and 1900, while, during a period of boom, you can sell where you please and any market will take your goods, in a time of stress it is the mutual trade within the Empire that counts. In the period 1875–1900, British trade with foreign markets was almost stagnant. I do not suppose that our exports increased by more than £l,000,000. What saved us was the fact that our exports to the Empire almost doubled within that decade. In 1920, the easy period, our exports to Empire countries were only 34.2 per cent. of our total exports, but look what has happened in 1925. In 1925, our exports to the British Empire were 39.3 per cent. of our total exports, in a more difficult year, and it is satisfactory to observe that in the first quarter of 1926 we show a still further advance: we exported to the Empire considerably more than we did in the corresponding quarter of 1925, and no less than 10 per cent. more than we exported in the corresponding quarter of 1924.


Does not that figure for exports to the Empire in 1925 show a slight fall as compared with the percentage for 1924?


No, it does not; we are steadily progressing. I can give the hon. Member the figures. In 1924 we exported 37.78 per cent., and, in 1925, 39.31 per cent.


It is a different figure.


These are the official figures, made out by the statisticians who have served us both so well, and I do not think there is any doubt about it. I will give the hon. Member another test; I will give him the percentages, quarter by quarter, of our exports of British goods. I will take the first quarter of 1924, 1925, and 1926. It tells the same story. In the first quarter of the year the proportion of our exports to the Empire is generally high— higher than the figures I have already given. In the first quarter of 1924, our exports to the Empire were 41.5 per cent., in the first quarter of 1925, 42.35 per cent., and in the first quarter of 1926, 45.81 per cent. That is a steady progression over the whole time; but the story does not end there. When you come to the character of our exports, the importance of the Empire trade is even more marked. Of our exports to foreign countries, 28 per cent. are fully manufactured articles; of our exports to the Empire, 38 per cent. are fully manufactured articles. Therefore, both in volume and in character, this expansion is proceeding.

It is also true that, just as our trade with the Empire is expanding, so is the Empire trade with this country growing, and growing even more rapidly, emphasising the mutual character of the trade. In 1913, the imports into the United Kingdom from the British Empire were 24.87 per cent. of our total imports, and in 1925 they had risen to 29.77 per cent. of our total imports, while in the first quarter of this year they showed again a marked increase as compared with the corresponding period last year and the year before. That illustrates beyond question the value to the Dominions and Colonies of the Wembley Exhibition and of the intensive selling campaign and the intensive effort that has been made by the whole British people to realise the possibilities of what trade with the Empire can do. These are satisfactory features, both by reason of the position as it is to-day and, still more, by reason of the hope which they carry with them in the development of future possibilities.

My hon. Friend the Member for Penryn and Falmouth (Mr. Pilcher), in a speech which I thought was of very great interest on Indian trade, coming from one who has close and long personal knowledge of the subject, drew attention to some features in Indian trade which gave him anxiety. It is true that we are meeting keen competition in some lines in the Indian market, and we shall have to meet that competition in the future, but there are two considerations which, in a close study of our Indian trade, are causes for satisfaction. My hon. Friend rightly pointed out how difficult it was for India to buy when the price of Indian commodities was relatively low and the price of imports from this country was relatively high. That, of course, was very marked after the War. In 1920, India was having to pay, because of the great rise in world prices, something like 3½ times as much as before the War for British goods and other commodities which she used to import, and she was only getting about 75 per cent. more for her exports. To-day, however, prices have come much nearer together. To-day it is estimated that Indian import prices are from 70 to 75 per cent. above are-War, whereas the price which India is getting for her commodities is probably about 40 to 50 above pre-War. There is, therefore, a much closer approximation between the price at which India sells and the price at which India has to buy. Again, although my hon. Friend referred, and it is a matter of anxiety, to a shrinkage in our total exports of piece goods to India, there is one factor, with which he also is probably acquainted, which is on the satisfactory side. Before the War, India used to import two bales of grey for one of white and one of coloured. After the War, when prices were high and purchasing power relatively low, the proportion of grey greatly increased. Today, however, I am told that India is importing seven of grey, five of white, and three of coloured. The reason why I say that that is hopeful is that it is in the white goods that we have a great predominence and superlative skill, and it is in the white goods that we have maintained practically our pre-War predominence in Indian markets. We are still, in the case of these white goods, doing 96 per cent. of the Indian import trade.

My hon. Friend also referred to the question of Indian railways. As he knows, the development of Indian railways must rest with the Indian Government, and it would certainly be both unwise and improper to try to force, in the interests of this country, a development which India could not meet or did not require. I agree, however, with my hon. Friend, and I think any impartial observer, reading the Acworth Report, and speaking with those who are acquainted with Indian railway administration, Indian travel facilities, and Indian desire for travel, would agree that it is in the interest of India, as rapidly as she can finance it, to increase her railway development and her railway facilities, and that entirely in her own interest. My hon. Friend may remember that at the last Imperial Conference we did hold out every inducement we could to the Indian Government to accelerate that development, and there was a proposal at the Imperial Conference in 1923, which was embodied in legislation, for giving a grant of three-quarters of the interest for a period of five years on accelerated development. Therefore, I think that anything we can do has been done.


Could that offer be made again to the Indian Government now?


It is a standing offer: it is embodied in legislation, and I hope that, when the Imperial Conference comes round again this year, we may have the opportunity of discussing railway development, and discussing it, as I have said, entirely in the interests of Indian requirements, which, of course, must govern the situation.


Has it been used at all?

7.0 P.M.


No, not by India; not at all. From this need for developing markets, and, above all, Empire markets, we draw a second lesson, and that is the enormous importance of saving to invest, because it is only by investment that new markets can be developed; and that leads up to the great importance of increasing the favourable trade balance of this country, in order that there may be more money for investment overseas. Buying British goods not only helps in itself by giving employment; it helps twice over, because it increases the available trade balance of this country, and helps us to develop other markets, which in themselves will be great buyers in the future. I have given on more than one occasion the figures of the apparent adverse balance, which, of course, are matters of fact, and, I think the estimate we made of the real net balance last year was a very conservative one. I think probably the invisible exports are a good deal higher than conservative statisticians would put them. Even making a big allowance for this, it is certain that our real trade balance available for investment to-day is not only relatively but actually far less than it was before the War. That being so, the amount of money available for investment being limited, two things appear essential. The first thing is to save, and the next is to invest to the best advantage, and to invest in those parts where your investment will give an immediate return and a progressive increase. We can all help. The individual can help in his individual capacity. The manufacturer can help by increasing his study of the market. I believe what was said by my hon. Friend that the further afield the market the more essential is the personal touch. I could wish that manufacturers would combine more for representation in distant markets. Four or five firms could join together and offer to pay one first-class man. It is better that they should get an order between them than that it should go to some foreign competitor.

The Government will give all the assistance which the Government properly can give to trade. I am not going in any polemical way to enter into an argument with the hon. Member for East Ham. South (Mr. Barnes), but I would hope it might be found possible to develop inter-Imperial trade without completely revolutionising the whole economic system of this country and setting up one State organisation in this country which would control all our trade. Short of that there is much the Government can do. I have had, and my hon. Friend the Secretary for the Overseas Trade Department has also had, many examples of orders and reproductive orders which have come through the activities of the trade commissioners in the Dominions and Colonies. Everything we can do to help emigration we are doing. I agree that when you look at the money which is being expended the results are, relatively, small. In that we shall persevere, and it is one of the subjects which will be dealt with, I hope exhaustively, at the coming Imperial Conference. We are helping by such efforts as the British Industries Fair. We can help with export credits. We are improving and simplifying the scheme in the way the Committee has recommended. That will simplify procedure. It will give an increased guarantee. But I still join issue with my hon. Friend the Member for Rossendale (Mr. Waddington), we are not going to finance consignment business. I am sure the practice which we have always followed in export credits is sound. We must only finance new business. We have a system of general credits, under which the manufacturer is able to draw his bills against new orders when he gets them. He then has the advantage of using up stocks. We only finance new business. We cannot go back on that and start financing old stocks.


These stocks are by no means old stocks. The seasonal demands of overseas markets require that the goods shall be there. Stocks are made to-day and sold in six months.


That is perfectly true and that can be assisted by the system of general credits under which the exporter is able to get his covering authority for sales up to an agreed figure in a particular market and he can obtain his finance within that figure as he sells his goods. I have had a proposal made to me not only to carry stocks made against the coming season, but to carry stocks much more than a few months old. I am sure we must stand to the principle that new business only should be financed. Subject to that limitation, I hope the new facilities will be of value, and I hope that they will be known to the general public. Whatever my hon. Friend can do will be done.

There is also the Empire marketing grant to which another hon. Member has referred involving the finding of £500,000 this year and a larger sum in future years. Railway Development in the Colonies is being undertaken both under the guaranteed loan or by loans raised without guarantees on the London market. The hon. Member mentioned Nigeria. He spoke of a limited amount which had been done in Nigeria in the past. I am glad to be able to inform him that Nigerian railway development is now progressing much more rapidly. By the end of this year an additional 294 miles of railway will be open, and another railway of 115 miles has been started within the last few weeks, the completion of which, it is hoped, will enable that Colony to export three times as much cotton as at the present time.

The hon. Member for Rossendale further suggested that we ought to do more in the way of co-ordinating Empire development. Particularly, he referred to freights and shipping. I think he ignored the great work done by the Imperial Shipping Committee. That Committee, which was established after the report from which he quoted, has been sitting now four or five years. It is an Imperial body whose members are appointed by the Governments of the different parts of the Empire. Since its inception it has dealt with 14 big questions arising in Imperial trade. They include the constitution of a permanent Imperial body on shipping questions; deferred rebates; rates of freight in the New Zealand trade; the economic size and speed of vessels in the Australian trade; the prospective size of vessels in the Eastern Australian trade via Suez; rates in the North Atlantic trade; Canadian marine insurance; East African shipping services; and methods of assessment of shipping to Income Tax within the Empire. That is a good sample of practical shipping questions which arise in Imperial trade, and every one of these has been dealt with by this Imperial body. They have reported unanimously in every case to the Governments of the Empire, and in nearly every case, I think, the recommendations have been acted upon. I do not believe that it would be possible or desirable to attempt to establish executive bodies of Empire authority. Advisory bodies, yes; but there is nothing from which some of the Dominions would be more averse, and, I think, rightly, than to set up an executive body which was representative of the whole Empire. That, I feel sure, would not be acceptable to the Dominions, but on the advisory side we have, as the hon. Member is aware, established an Imperial Marketing Committee. The Imperial Economic Committee, the counterpart of the Imperial Shipping Committee, is in session to-day, and has made two reports of great value.

There was one other point raised, and that was air routes. A good deal more has been done than the hon. and gallant Member for Central Hull (Lieut.-Commander Kenworthy) was inclined to admit, or perhaps knew. Let me say two things to him. In the first place, it is not quite so simple or so sure as his arithmetical calculations would have led us to believe. Whether with aeroplanes or airships the development of an air service to Australia is a matter which requires a great deal of experiment, and is one of considerable financial uncertainty. You cannot count upon that regular flow of mails day by day which he suggested. But it is a matter of great importance, though I do not think it has perhaps on all grounds quite the importance he suggested. If I wanted to pass a large sum of money to Australia, he suggested I could only do it by sending a cheque by post and by paying large interest. Cable transfers are sure, and simpler, and more economical than that, in spite of the rates sometimes charged for cable transfers in that direction. It is of great importance to accelerate the mail services. It was taken up at the Economic Conference, and the Air Ministry have been by no means idle since. It is hoped that services from Cairo to Karachi will be working by the end of the year. Experimental flights have been made by the Air Ministry along that route. Experimental flights have also been made from the Cape to Cairo, and, what the Dominions stressed at the Conference, constant consultation between the Dominions and this country, is steadily going on, and information is interchanged and consultation takes place by correspondence every month with the Dominion of Australia and the Air Ministry, and I think with the other Dominions.

In every one of these ways the Government can help, and is helping. This Amendment is an incentive to us to pursue its objects. To all this one other thing must be added. Whether it is in Empire markets or in foreign markets, we have to produce efficiently and to sell as cheaply as we can. That means output and it means good plant, and those two are dependent the one upon the other. We shall only develop Empire trade in the future, as in the past, if we have the same spirit of adventure in business that those merchant adventurers who went out to found our Empire trade had in the past. If that spirit of adventure is to be there, there must be one requisite here, and that is security and stability at home.


I should like the right hon. Gentleman to deal with this point. Many of us are concerned as to what the effect will be upon the food import of the control boards which are operating now in New Zealand, and are likely to operate in Australia. It is important from the point of view of Empire trade that we should not have any artificial restrictions on those imports, and I should like to ask whether the right hon. Gentleman has been in touch with merchants and the importing interest in this country as to the effect on our markets of the new control, and whether he is able to give us any further information.


I should not like in a sentence or two to deal with the whole question of that development. I am aware that it is of importance, but I think it would be extremely unwise if I were to attempt, in answer to a question, to discuss, still less to criticise, such State Boards as have been set up.


The right hon. Gentleman's speech has been not only very interesting to listen to but will, I am sure, be a very useful source of information when one reads it in the printed form. I am also grateful to him for the fact that when dealing with what he calls the difficulties of the prohibition policy of the Labour party, he was so clear and so explicit, thus I think making quite definite what is the real issue between the two parties. It is true, as he said— and I think only one hon. Mem- ber on that side has said anything of a different character— that the desirability of furthering Empire trade, in fact of furthering any kind of trade, is a matter that is accepted by every single person in the House. But while we would make the pivot of our policy the standard of life of the worker, the right hon. Gentleman would make the pivot of his policy something less exactly definite, and perhaps not quite so exactly definable. The right hon. Gentleman may say that to make the standard of life of the worker, that is to say of the producer, the pivot of trade policy is not a possible thing. It is not only a possible thing but it will be found in practice to be the only economic thing for this or any other country to do.


I do not want the hon. Member to misunderstand me. I am as anxious as he is to maintain and to increase wages and employment. The only issue between us is that, whereas he says you can do it by prohibition of imports and licences, I think ho will find that is an impracticable policy to carry out.


I am very glad to hear the right hon. Gentleman say he is as anxious as I am to increase wages, because I assure him I am so tremendously anxious and enthusiastic about it that from this time onwards I shall give him no peace on the matter with regard to his safeguarding proposals and all the other matters which involve the question of the standard of life of the workers. We can count him from this time forward as our ally in the campaign for high wages. We are exceedingly glad to know that that is the direction in which his mind is working. Therefore it is rather a pity he did not bring his mind to bear on the Chancellor of the Exchequer when he was framing his Budget in order to get something more put into it to deal with that aspect of the situation. I should like to call attention to a phrase bearing very directly on this matter of the trade of the Empire— a sentence in the Budget speech. The Chancellor of the Exchequer was summing up the whole question of revenue and expenditure: When, therefore, we contrast on the one hand a revenue which in its permanent branches is barely holding its own with the strong tide of expenditure on the other "— There he raised his arms with that dramatic charm which is one of his delightful attributes— the outlook is somewhat bleak."— [OFFICIAL REPORT, 26th April, 1926; col. 1691, Vol. 194.] I listened to the Chancellor, as I have listened to right hon. Gentlemen opposite, with great attention and, looking at the matter for the moment from the standpoint of the finances of the Empire as a whole, I do not see that the policy laid down by the right hon. Gentleman is going to make the outlook any less black. It is, of course, a conservative proposal. It only looks a very short way ahead. It cannot be described as a very courageous policy, and while I notice the right hon. Gentleman said we can all help, the individual purchaser can help and every person can help, he did not tell us how the Government could help, and it seems to me that in this matter of Empire trade the Government ought to help very much more than they are doing at present. The Chancellor of the Exchequer talked about his Budget of last year as a Budget of silk and gold. I suppose this year it might be called a Budget of bookies and brewers. It would really have been very much better if he had devoted his Budget to developing the standard of life of the workers and improving the trade and the resources of the Empire as a whole and made it a Budget of men and Empire instead of bookies and brewers.

There is only one way in which Empire trade can really be made to take the position in the world that we all say we want it to take, and that is by improving, in the first instance, the purchasing power of the internal home market, which the Chancellor said was 10 times the external trade of the country. Whether that figure is correct or not I think that is the figure he gave. At any rate, the internal trade is very much more valuable than the external, and unless you raise the purchasing power of the internal market you will not get prosperity restored. The only way of doing that is by the policy which the President of the Board of Trade and I have agreed is the policy for the country, a policy definitely making for high wages in industry. That is not, unfortunately, a policy which is very much in favour at present with employers as it is with the President of the Board of Trade, as I gather from the hon. Gentleman opposite that he is in favour of the same policy.


Of course, we are in favour of high wages. But we want to be able to turn our goods into money again in the export market so as to get back their cost and the higher wages we-pay the better we like it.


It is extremely unfortunate, if that is the view of the Government, that they did not send out to the country a clarion call for high wages, that they did not say to the employers, "This is the root of prosperity, this is the way we must travel," because unfortunately the employers do not agree with the President of the Board of Trade and the hon. Gentleman opposite. Empire trade, according to the Budget, is to be helped by a series of preferences, and when the question of Preference came before the House I supported it, and I shall do the same again, hut there are very many other ways in which trade could be helped, and perhaps the hon. Gentleman will tell us why the Government is not making use of some of those ways which are in its power to do. Take, for instance, this question, of which we have heard a great deal, of buying British goods and Empire goods, and we have an Empire marketing fund of £500,000. What has been done with that fund? What is being done with it at present? What has happened to the other £500,000 which was going to be given to the Dominions as compensation? In fact, why is it that, with the executive ability which distinguishes the Government, they have not been able to devise a method of spending to the benefit of the Dominion producer even £500.000 up to the present. What is the defect in organisation? Why have they not done it? An hon. Member opposite raised the question of migration. Is it not a lamentable fact that with an Empire Settlement Act, enabling us to spend up to £3,000,000 a year, with the fact admitted on all sides of the House that a man resident in Australia is a very much better customer for our goods than a man resident elsewhere outside this country, we have never yet been able to organise our migration so as to spend more than a small fraction of that amount? That is one of the ways in which Empire trade could be very much helped. Why is it? May I suggest to the hon. Gentleman that his Department is very largely to blame in the matter? There is no one body in this country at present really responsible for migration. Migration is no one's job.


Oh, yes.


Let the hon. Gentleman think himself for a moment out of his responsible office into the position of a young man in a country village, or in an industrial part of a great city, who wants to know what are the opportunities open to him for migration. He wants to know where he can best get employment. He wants to know where his special capacity will best get a chance of showing itself. To what place is that man to go to get information?


The Oversea Settlement Department of the Dominions Office.


I suppose there is a special waiting room there reserved for agricultural labourers and for people who have been at the queue of the Employment Exchange. It is not easy for anyone to get any information on the subject of migration, and anyone who wants to get information has to go from one railway or steamship office to another, from one Dominion office to another.


I should not like that to go unchallenged A large amount of information is available at Employment Exchanges. All the information he desires is obtainable, with the slightest exertion, from the Labour Office.


I am sorry I do not agree. A certain amount of information is available at Employment Exchanges, and that is the very worst possible place for it to be available, because it at once connects migration, in the minds of the man who is applying for work, with unemployment. It is using, or appearing to use, the weapon of unemployment and starvation to drive people out of the country, and that is a policy I am sure the hon. Gentleman does not wish to identify himself with and it is certainly a policy to which we on this side of the House are implacably opposed.

If the hon. Gentleman when he wants to visit Germany or Switzerland or Greece or any other part of the world, had as much difficulty in getting information about his journey as anyone who wishes to go to Canada or Australia has, he would not go to the Continent as frequently as he does. What we want is an Information Bureau which shall make it as easy for the intending migrants to get information in regard to Canada, Australia, New Zealand, South Africa or any other part of the Empire, as it is for the hon. Member or myself to get information about hotels in Paris, Berlin or Milan. We want a kind of Imperial Cook's Office to which people can go. Until something of that kind is done it will not be possible for large numbers of people to migrate. The £3 fare to Canada is attractively low but, quite frankly, I am rather afraid of a large number of people going in an unorganised way, and I am afraid that some of them will have such a severe experience that the reaction in this country will be worse than if they had not gone.

I have given this instance, and I might have given more, to show that the Government who at the present time are so loud in their protestations of Imperial enthusiasm, are not using their powers to help the Dominion producer through the Empire Marketing Fund, are not using to the full extent their resources and powers to help migrants, and are not making use of those resources which they already have. If the Government are going to help the development of Empire trade, they ought to throw the whole of their weight and influence into the organisation of our trade and resources. The direction of Empire policy must be done by the State and it must be done by this Government because there is no other body big enough or broadminded enough to do it. You cannot possibly leave emigration and Empire trade in their different aspects to private initiative. Private initiative is too shortsighted. It is only possible for an Imperial Government to take a sufficiently long view.

I have wondered whether the Government are keeping something up their sleeve for the Imperial Conference. Are they keeping in hand some wonderful proposals which are going to help the Empire and to make into realities the enthusiasm of after-dinner speeches, for use at the Imperial Conference, or are there no proposals? I begin to think that the Government enthusiasm for Empire is rather like that of Mr. Micawber who, if I remember rightly, also had certain Colonial experience at one stage of his career, and that they are waiting for something to turn up in home affairs and waiting for something to turn up in Imperial affairs. Let me give another concrete example. If the Government are so very anxious to develop trade with the Empire, why have they not assisted or attempted to assist the motor export trade to the Empire? The motor export trade to the Empire is penalised by the fact that cars in this country have to be made in order to comply with the conditions of taxation as to horse-power and those cars are not suitable for the Empire market.

Mr. SAMUEL indicated dissent.


So I am informed by Empire authorities. Apparently, the hon. Member disagrees with that view. I am informed that if the Chancellor of the Exchequer had taken off the tax on horse power and substituted, as he spoke of doing, perhaps, next year, a tax on petrol consumption, that that might have had the effect of enabling the British motor car to compete on equal terms with the American motor car in the Colonial market, and with great advantage. I am aware of the difficulties there are, but I am told that this is one of the things that the Government might have done. I am instancing these facts because when it comes to doing something practical the Government, who talk in strains of tremendous Imperial enthusiasm, are doing very little, or nothing at all.


I cannot allow that statement to pass. The suggestion with regard to the beneficial effect that the change from a tax on horse-power to petrol consumption would have upon British Empire overseas trade in British motor-cars was one which I looked into very thoroughly the first month or two after I was appointed to my present office. A former Chancellor of the Exchequer, the right hon. Member for Hillhead (Sir R. Horne), made a statement on this same matter yesterday with which I did not agree. It is not often that I disagree with him. Last year I put the whole question of the export of British motor- cars to the Dominions and the Colonies before representatives of the motor trade, and I came to the conclusion, and they came to the conclusion, that there was nothing in the idea which has just been mentioned by the hon. Member. The export of motor-cars to the Dominions and Colonies has been looked into by my Department, so the charge about the Government doing nothing is not well substantiated. The export of British motor-cars to the Dominions, particularly Australia and New Zealand, shows a very wholesome and satisfactory rise. The fact of the matter is that during the War our motor people had not the chance to get into those markets, and American cars crept in. Now we are getting into those markets. But we are so busy with home trade that we have not yet reached a saturated market at home so that our output can overflow into the Colonial markets. We are, however, getting Colonial markets, and the hon. Member need have no fear that we shall not get a full share of those markets in due course.


I hope that statement by the hon. Member will calm the country in general, but I am sorry to say that it does not calm me. It may be true that the hon. Member disagrees with the right hon. Member for Hillhead, whom, I am sorry to say, is not in his place. On this occasion I am inclined to think that there is something in what the right hon. Member for Hillhead said. In the Dominions and Colonies certain British cars will not function owing to the fact that they are built on a specification for our home market and they do not work adequately in that market. It may be true that the hon. Member's Department has looked into this matter, and that the Government have looked into the question of migration, just as they have looked for many months into the question of Empire marketing, but they have not done anything about it. What the country and the Empire wants is not that the matter should be looked into, but that something shall be done effectively.

We want a very much more vigorous Empire policy than we are likely to get. I should like to know what justification the Government have to offer for nothing whatsoever having been done to carry out the promise to the Dominions to give them a grant of £1,000,000 to help Empire marketing. Why has no scheme been introduced for that purpose? I daresay there is some kind of official explanation. I do not know whether it will satisfy the Dominions. I hope it will not satisfy the Dominions, because I cannot see what justification there can be for the long delay. Are the Government going to pay the Dominions interest on the money which ought to have been expended a year ago or during the past year? The same argument applies with regard to migration. What is the justification of the Government for not spending up to the amount already possible under the Empire Settlement Act? Everybody agrees as to the desirability of migration. The hon. Member may think that the Oversea Settlement Committee provides all the information that is required, but I would respectfully suggest that it is not practical politics to ask the ordinary applicant who wishes to have information for the purpose of migration, to go to the Oversea Settlement Office or to the Employment Exchange.

The men who go to the Employment Exchanges to draw the unemployment dole frequently complain to me that they can got nothing but very sharp and sudden replies to the most ordinary question dealing with unemployment and the money which they are to receive. If these men were to ask for the detailed, careful and personal consideration which is necessary, and which should be given, to men when they are considering the important question of going from this country to another country, I imagine that they would, to use a popular phrase, "Get their heads snapped off." I do not think it is a good policy to ask them to go to the Employment Exchanges, where they have to get their unemployment benefit, in order to secure information about the Dominions.

If the Government are serious about Empire trade they must translate the declaration which the President of the Board of Trade has made about a campaign for high wages, into action. Let them tack on to the proposals about the safeguarding of industries a proviso that when an industry benefits by safeguarding, it shall at the same time benefit its workers, and that every increase of profits in a trade which is safeguarded shall be followed by an immediate and comparable increase in wages. That is a very sound economic scheme. It would distribute wealth and increase purchasing power. Let the Government take steps to increase the standard of life in this country. The real difference between the party opposite and ourselves is that the party opposite is conservative and, perhaps, rather timorous, and have not the necessary initiative and enterprise to do these big things. I am sorry that the Chancellor of the Exchequer is not here. In a charmingly humorous way he compared himself to a swimmer going across the Channel, and at a certain moment having to decide whether he should give up the attempt or go forward with the gold standard. I cannot help thinking that the Chancellor of the Exchequer would have done better had he compared himself to a goat tied to a stake by a chain, and only able to run round a very limited circle.

The Government at the present time seem to be tied by a chain, the chain of their own ideas, not the chain of economic necessity, and we shall not get out Empire trade or our home trade put on a good foundation until the chain which binds the country to Conservative principles and ideas is broken, and until we are able to take very much more drastic steps to improve the standard of life of the workers than any Conservative Government will give us. We shall not get Empire trade until a Government are in office who have the initiative to carry out and put into operation the powers which they already possess. If you want a vigorous Empire you must do two things, first, you must take the Empire into partnership, and that you have not done up to the present, and, secondly, you must take the workers into the partnership which you are always refusing to do.


I was sorry to put a question without notice to the President of the Board of Trade earlier in the Debate; but I hope that between now and the occasion when next we discuss Empire trade and Empire development, the question I raised will be looked into. Those of us who are interested in the very large question of the import of foodstuffs, particularly from the Empire, are very much concerned as to what the effect may be upon the British market for these goods, and consequently upon the reciprocal trade from this country by export to the Empire. The percentage of imports of certain staple foodstuffs from the Dominions are so high in comparison with the total amount of the imports into this country that it may be a very important and serious question in the future. From New Zealand, for instance, we are taking 48 per cent. of all the cheese we import, and of butter, 22 per cent. When that comes to be governed by a system of control not exactly in the hands of the Government but under a Board which is partly controlled by the Government, if that is used for the manipulation of prices against the consumer, upon whose purchasing capacity the market may depend, it may have a very serious effect. I regret that we could not have had a fuller statement from the President of the Board of Trade, but that was largely because I had not given notice of the question. I hope the matter will be looked into before the next occasion. The only other point I want to raise is this— it is a matter of grave importance. We were told by the President of the Board of Trade that the Indian trade would be very much improved if the peasants were able to buy goods which they cannot take at present. He made some reference to the differentiation in price levels during the last few years, but what I want to drive home is that while he is perfectly correct in saying that prices for some Indian goods have improved, that is actually reflected in the profits of British capitalists holding shares in Indian companies, and the real fact is that the position of the Indian worker has not simultaneously improved.

Take the tea position. In the last four years there has been an extraordinary development in the position of British tea companies in India. They have paid 40 per cent., 50 per cent. and as much as 60 per cent., and I think the Board of Trade might very usefully use their influence in order to see that British companies in this happy financial position used some of the accrued surplus now coming to them, some of this 40, 50 and 60 per cent., for improving the position of the Indian peasants. Then there might be a better hope for the textile workers of this country. I emphasise that particularly because of the statement made at Wembley by one of the assistant-registrars of one of the Indian provinces at the Empire Co-operative Conference. He said that if you raise the purchasing power of the Indian peasants by £1 per head per annum, the whole of Lancashire would be kept fully employed.

Supply accordingly considered in Committee.

[CAPTAIN FITZROY in the Chair.]

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