HC Deb 22 February 1932 vol 262 cc44-75

The following Amendment stood upon the Paper: In page 5, line 40, after the word "Rhodesia," to insert the words "the Sudan."[Mr. Albery.]

Mr. ALBERY

I shall not take up the time of the Committee with this Amendment if I can be assured by the Chancellor of the Exchequer that the point is adequately covered in the Bill as it stands.

The CHANCELLOR of the EXCHEQUER (Mr. Chamberlain)

I can give my hon. Friend that assurance.

Mr. ALBERY

Might I ask the right hon. Gentleman to point out how it is covered in the Bill?

Mr. CHAMBERLAIN

The position of this territory is a little different from that of other territories and it would certainly not come in under this Clause, but I hope that my hon. Friend will be satisfied with the assurance that it has always been treated as he intends and that it will so continue to be treated under the Bill.

Sir P. HARRIS

It ought to be made clear under what particular form this territory comes within these provisions. Obviously, the Sudan is not a Mandated Territory, and it is not part of the British Empire. It will, if anything, come in as a Protectorate, but that ought to be made clear. Egypt would not come into the preferences, and it might be for the general convenience if we knew under what particular definition the Sudan will be entitled to inclusion.

Mr. ALBERY

In view of the explanation which has been given by the Chancellor of the Exchequer, I beg to ask leave to withdraw the Amendment.

The CHAIRMAN

I understand that the hon. Member has not yet moved it. Does he desire to move it?

Mr. ALBERY

No.

Mr. CHAMBERLAIN

I beg to move, in page 5, line 42, after the word "by," to insert the words: or which are administered under the authority of. This Amendment is to deal with a few small territories which are under the authority of Dominions but which are not administered by the Dominions in virtue of a mandate.

Amendment agreed to.

Mr. CHAMBERLAIN

I beg to move, in page 6, line 3, after the word, "from," to insert the words "any part of the British Empire."

This is the first of a series of Amendments having to do with the case of goods which are produced in one part of the Empire and consigned from another. I think the simplest way of explaining the effect of the Amendments is to say that as long as the produce of the Dominions comes in free, that is, until the 15th November, all goods which have been produced in a Colony will come in free even if they be consigned from a Dominion. Similarly, if it should happen to be the other way round, all goods produced in a Dominion which are consigned from a Colony would come in free. But a somewhat different series of circumstances will arise if and when, after the Ottawa Conference, some duties are applicable to some goods coming from a Dominion. We have then to contemplate that there may be goods coming from a Dominion some of which may be free, some of which may be subject to a reduced duty, and some of which may be subject to the full 10 per cent., and what we have to provide is that if goods produced in a Colony which, if consigned from a Colony, would come in here free, are in fact consigned from a Dominion, they shall not follow the Dominion practice as to whether they come in free or get the preference. The preference in that case would be the preference of the Dominion and not the Colony, and they would only come in free if the goods from the Dominion came in free themselves. This is a little complicated, but I hope I have succeeded in making it clear.

Sir STAFFORD CRIPPS

I am only asking for information, but I do not quite understand the working of this Clause. I gather from what the right hon. Gentleman has said that the Sub-section at the bottom of page 149 of the Order Paper goes with this Amendment.

Mr. CHAMBERLAIN

Yes.

Sir S. CRIPPS

I do not quite understand that that Sub-section operates in the way stated by the right hon. Gentleman, but it may be that I have misread it. The Sub-section reads: (4) Where by virtue of Sub-section (2) of this Section any duty under this Part of this Act becomes chargeable on goods grown, produced, or manufactured in any country to which this Section applies"— that is, a Dominion, and it goes on— goods consigned from that country shall, unless they are goods of a class or description specified in an order made with respect to that country under the last foregoing Sub-section, be treated for the purposes of this Section and of any order made thereunder with respect to any other country and for the purposes of the next following Section of this Act as not having been consigned from a part of the British Empire. I will take the case of goods from a Colony which, are consigned through a Dominion and as regards that Dominion there is an Order made. As I read it, if those Colonial goods are consigned through a Dominion port, they will be deemed not to have been consigned from a part of the British Empire at all; that is to say, they will be completely excluded either from Colonial or from Dominion preference. I am sure that the right hon. Gentleman desires to do what he stated, but. I suggest that these words do not accomplish that, and that the net result of this would be that Colonial goods would be deemed not to be Empire goods at all if they came through the port of a Dominion as regards which an Order had been made under the Section; and I suggest that it is most undesirable that Colonial goods should be charged with the tax on goods from a Dominion merely because they are shipped through a Dominion port. If they are genuine, bona fide Colonial goods, they should come in free. Secondly, they should not be excluded, as I suggest that they are excluded, by the operation of this Subsection.

Sir P. HARRIS

May I give a very practical example? The Dominion of New Zealand is very intimately connected with Samoa, which is a territory mandated to the Dominion of New Zealand, and New Zealand is also intimately connected with Fiji, which is, I think, more or less a Crown Colony. A great deal of the trade of both those islands passes through Auckland, which is the trading port of that part of the world. A great part of the sugar trade goes through Auckland. I hope it will not happen, but suppose that, as the result of the Ottawa Conference, it is necessary to impose a duty of 10 per cent. on part of the produce that comes from New Zealand, it would be a hardship on the port of Auckland and also an injury to the islands of Samoa and Fiji if their products, because they passed through Auckland or were handled there, should be subject to the duty of 10 per cent. I know that that would not be the purpose of the Government, but I think, in order to meet a rather difficult situation, such a provision should not be made. Either the port of the country of origin or the port of the colony of origin should be the definition that would entitle that part of the British Empire which produced the goods to get the full advantage of any preference given. I am afraid the Chancellor of the Exchequer was not listening. I saw that he had somebody else's ear.

Mr. CHAMBERLAIN

I think I can explain the point. All through consignments will take their preference or non-preference from the country of origin. Therefore, if, for instance, an article is produced in Northern Rhodesia and is consigned through to this country, it does not matter through what port it goes, it will come in free to this country because it comes from Northern Rhodesia. But let us suppose that it goes to the Union of South Africa and is there used in some manufacture, and then consigned from a South African port to this country. In that case it, would take the preference which is given to that particular kind of article in respect of Dominion produce, the Dominion of South Africa produce. It may be in a particular case that it comes in free still, or it may be that it comes in under a preferential rate, or it may be that by mutual arrangement it comes in without any preference at the same rate as from a foreign country. That is what is explained in the Amendment to which the hon. and learned Gentleman drew attention. Is that clear?

Sir S. CRIPPS

I do not think that that is what the Sub-section says, but I appreciate that it is what the right hon. Gentleman desires.

Amendment agreed to.

Major NATHAN

I beg to move, in page 4, line 11, at the end, to insert the words: Provided that the Government of the country from which the goods have been consigned shall not later than the thirty-first day of March, nineteen hundred and thirty-two, have enacted that, as from a date not later than the thirty-first day of March, nineteen hundred and thirty-two, goods consigned to that country from the United Kingdom, and grown, produced, or manufactured therein, shall be admitted to that country free of duty, or shall have given His Majesty's Government satisfactory assurances that such legislation will be immediately effected. The object of this Amendment is to ensure that the ad valorem duty and the additional duties imposed in this Bill, from which, by the operation of the Clause as drawn, the Dominions are exonerated, shall apply unless, at the same time as the remission applies to the Dominions, they extend reciprocal benefits to this country. What is the reason given by the Government on so many occasions for introducing this Bill, for pressing it through the House at such speed, and for limiting our time for discussing our fiscal relations with the Dominions—an important matter—to something under four hours? It is that the import of goods into this country will have a damaging effect upon our balance of trade and will imperil the position of sterling; and that revenue is required to relieve the British taxpayer. If imports to this country will have the effect which the Government ascribe to them—and we on these benches do not subscribe to that view—imports from any country will have that effect, irrespective of whether they come from foreign countries or from the Dominions.

Those of us whose names are attached to this Amendment feel that the Dominions should be put in this matter on precisely the same footing as any other country. We cannot expose ourselves to the dangers which have been referred to by the Chancellor of the Exchequer and the President of the Board of Trade, either at the hands of foreign countries or at the hands of the Dominions. If there be damage, it will be equally great whether it comes from the Dominions or from anywhere else. But if we are to be asked to make to the Dominions this substantial concession to what the Government have described as our vital interests, Jet us at least have a quid pro quo. Let us at least ensure that for a concession which we are asked to extend to the Dominions we shall receive a like concession from them. That is the object of this Amendment. Arrangements for mutual trading must be reciprocal, and the Amendment might almost be regarded as a first step in the direction of Free Trade in the Empire, and in the formation of a Free Trade union of the Empire to which every other country should be entitled to enter upon like terms.

It will afford to the Empire a nucleus round which every country with which we trade can gather for the purposes of creating what at this time we require almost more than anything else—an enlargement of the area of Free Trade. In that connection, I welcome the speech made by the Chancellor of the Exchequer at Birmingham on 12th February, in which he indicated that he proposed to take part in initiating negotiations for the creation of a Free Trade or low-tariff area. The proposal in this Amendment is the first step in that direction. It is an invitation to the Dominions to join with us in creating a Free Trade area. Those hon. Members who proclaim themselves adherents of Empire Free Trade will, of course, vote for the Amendment. They cannot do otherwise, for if they did they would be confessing to the Committee, the country and the Dominions that their boasted policy of Empire Free Trade is just a matter of sound and fury signifying nothing.

The SECRETARY of STATE for DOMINION AFFAIRS (Mr. J. H. Thomas)

Whatever doubt may have been in the minds of hon. Members as to the real object of this Amendment, it was dispelled by the brutally frank way in which it was commended to the Committee. When I first saw the Amendment on the Order Paper and looked at the names, I assumed that there were some new Empire Crusaders here. I assumed that the hon. and gallant Member and his friends were getting somewhat jealous of the success of Lord Beaverbrook and wanted to give some evidence of competition in that particular direction. Clearly the speech we have heard to all intents and purposes says to the British Parliament that we ought to tell the British Commonwealth of Nations, "You not only must be treated as foreigners, but you are foreigners." That is an insult. Whatever views you may hold, whatever political faith you may embrace, when you remember the position that the Dominions without pressure took in our hour of trial—[interruption.] Therefore, there can be no doubt whatever—and I am sure that the hon. and gallant Gentleman and his friends will not join issue with me when I say this—that the Amendment is not intended seriously. They know perfectly well that it is impracticable, and that the date which they suggest, even if they mean it, is an impossible date.

Major NATHAN

May I ask why it should be impossible for a Dominion Parliament to pass legislation by 31st March which this Parliament has been called upon to pass in a few days?

4.0 p.m.

Mr. THOMAS

The answer is very obvious. The hon. and gallant Member himself says that what he wants is a quid pro quo. Does he assume for one moment that between now and 31st March a scheme can be worked out? I am talking from the Dominions point of view, because what the hon. and gallant Gentleman says is this. So far as any preference to the Dominions is concerned, we say to them here and now, "Disregard any matter of your local circumstances and maybe any of your secondary industries." That is what the hon. Member means. That is exactly what he says, and he knows perfectly well that, from a practical point of view, it cannot be done. Therefore, in saying that, I am justified in treating it as a wrecking Amendment. It is not only not necessary for me to say that the Government will not accept it, but we sincerely hope, especially after the speech of the hon. and gallant Gentleman, that if taken to a Division it will not receive support. What is the justification for saying that, as far as the Dominions are concerned, to all intents and purposes they should be treated as foreigners? Is that the answer to the nearly 200,000 people who, prior to last year, left these shores every year, and constitute the backbone of our Dominions Is that the answer to those, numbering perhaps 100,000 at this moment, who are registered and waiting a chance even to-day to go to the Dominions? The figures of our unem- ployed show to what a tremendous extent they are supplemented by the unfortunate slump in our Dominions. Therefore from any help, any encouragement, anything that will tend to restore their prosperity, it must be admitted that we shall be the first to benefit. The hon. and gallant Member himself admits that. If that be so, why proceed to insult them? Why proceed straight away to say to the Dominions in substance, "So far as you are concerned, you are to be treated as foreigners?"

Major NATHAN

I cannot allow to go upon record the statement of the Secretary of State for the Dominions that I have insulted the Dominions. I am putting Britain first, and what I have said, and what I repeat is, that if it be antagonistic and injurious to the interests of this country that goods should be imported into this country from one country, it is equally injurious that they should be imported from another country, whether a Dominion or not.

Mr. THOMAS

I think that not even that explanation will enable the hon. and gallant Member to get away from the first speech he made. I do not think that my interpretation of his speech put it too high, but I want to follow it up by pointing this out. It is known that there is to be a conference in Ottawa. Outside of those associated with this Amendment, not only everyone in this House on both sides, but everyone in the country looks forward, in my judgment, to that conference in the hope that it may be a turning point in our Imperial policy. No one will disguise or minimise the difficulties, but if the conference is to succeed, surely we are entitled to say, let us do all we can to create a good atmosphere. Will the hon. Gentleman or anyone else in this House deny that the Government by their sacrifices have made their contribution In spite of that, I will admit that some of our Dominions have not done all they might; but that is no reason why when we set an example it should be crabbed by Amendments of this kind or speeches such as the one we have heard.

The Dominions have made their view perfectly clear, but do not let us go in a haggling, whining spirit. Let us go and see what we can throw into the common pool for the benefit of all. We have already shown our hands. I do not want to disguise from the House what is clearly my view, that I expect and believe the Dominions will respond. We put all the cards on the table. No Dominion can complain in any degree whatever that on the first import duties and at every stage in connection with this matter the Government have taken the view that we will do all we can to encourage, help and foster an Imperial spirit, and I say that it is now up to the Dominions themselves to respond. I am not unmindful of the interests of our own trade and commerce. It will be our duty to point that out. It will be our duty to go and present the full case. I do ask the House not to prejudice the situation, not to make the conference au absurdity from the start by accepting the Amendment now proposed, and I ask the House to reject it.

Sir P. HARRIS

As far as I am concerned, I do not want to say anything to the Committee to make the very difficult task of the right hon. Gentleman more difficult, or which could be interpreted by any parts of the British Empire as unfriendly to the great Commonwealth of Nations. I know that what is said in Debate here is telegraphed to Australia, New Zealand and Canada, is magnified and something read into it quite different from what is the case. I happen to have lived for a number of years in the Dominion of New Zealand. I have great associations with it. In fact, I owe everything to it. My grandfather, as long ago as 1838, was in New Zealand. My mother was born there. I have a son there at the present time. My father went out in the early 'fifties. Therefore, I agree with the right hon. Gentleman absolutely when he says "With unemployment not only in this country but very serious in the Dominions, do not let us say anything that will be interpreted as an unfriendly gesture to any of the component parts of the British Commonwealth of nations."

They have at the present time a task even more complicated and more difficult than our own. I agree with the right hon. Gentleman that they look to us with hope to extend to them a friendly hand, and we do not want anything to be said to give the impression either in Australia, New Zealand or Canada that we are not sympathetic to their economic problems, and my hon. and gallant Friend never said anything of the kind. He never mentioned the words "foreign country." It is not suggested that this Preference should apply to a foreign country. He pointed out—and rightly pointed out—what an extremely difficult thing it is to implement an economic bargain of this kind. I often feel in my heart of hearts that it is a tragedy that, perhaps, 40 or 50 years ago, a different turning was not taken in the various parts of the Dominions, and if the building-up of an independent industrial life had never been attempted. If these great new countries, who, after all, owe everything to this great country, to pioneers like Captain Cook and Tasman, who opened up civilisation in those territories, had realised that their business, their duty, was to develop their agricultural industry, their raw materials, and assist the old country to build up its industrial organisation, then some of the ideals, which I consider to be fine ideals, might have been possible. But, probably alarmed by what had happened in the United States of America, we decided to give them free economic independence to work out their own salvation in their own way. The result is that they have built up an independent economic industrial life to which, as the years go on, they attach more and more importance. Their slogan has been "Australia first, and Australia first every time." I came across this cutting from the "Australian Manufacturer "—I agree a prejudiced organ: It should be remembered that the Preference we give to Great Britain is largely nominal. We first put on a duty high enough to protect local industry from British competition or from any other competition. We then make that duty a percentage higher for foreign countries. We therefore do not give Great Britain a real Preference. The real Preference is given to our own manufacturers. And as soon as it is found that a certain duty on British goods is not high enough to protect Australian manufacturers, that duty is sure to be raised. My hon. and gallant Friend wants to make clear in his Amendment that we should face realities, that we should face facts as they are, and that when my right hon. Friend goes to Ottawa, he will not go blindfolded, he will not go into a land of make-believe, but go there knowing that he is dealing with independent States committed to a policy of Protec- tion, determined to keep their tariffs effective, to keep their own industries and not prepared to enter, as we should like, into a general system of Free Trade in a self-contained Empire. That is what we want to realise. My fear is that in building an economic world on the foundations of 10 per cent., far from strengthening the bonds, we may weaken them. That is the whole case against these proposals. I am disappointed, frankly, that in having decided to make this gesture to the Dominions we limited it to the 15th November. I think, on the whole, it would have been far better if this 10 per cent. had been made unconditional, rather than it should have been made a basis for bargaining.

Mr. THOMAS

Why is the hon. Gentleman's name down to this Amendment? I was dealing with the Mover of the Amendment and his speech, and the hon. Member has now thrown it over. Why not go one step further, and say that he is not supporting the Amendment on the Paper?

Sir P. HARRIS

I am sorry that the right hon. Gentleman has not been following the Debates of last week. If he had, he would know that I am against the principle of a 10 per cent. tax as being unsound from any point of view, whether it is to protect our own industries, or whether it is to cement the Empire. If we are to give this 10 per cent. preference, let us give it unqualified.

Brigadier-General Sir HENRY CROFT

Your Amendment qualifies it.

Sir P. HARRIS

We do not have the help of skilled Parliamentary draftsmen such as are available to a Member of the Government. The right hon. Member has been long enough in Opposition to know that we have to draft Amendments according to the rules of procedure and to the best of our ability, and I am not responsible for the wording of this particular Amendment. What will be the position of the right hon. Gentleman when lie is at Ottawa next summer? All eyes will be turned on him. It will be an epoch-making conference. The Prime Ministers of Canada, Australia and India—no, the representatives of India—and the Prime Minister of New Zealand will be sitting round a table to cement the Empire. The first thing the right hon. Gentleman will say will be:

"We have put a 10 per cent. tax on our foodstuffs, our raw materials and on manufactured goods. We have let your produce in free, but that was a gesture, and now I want a quid pro quo." Is he going to say to Australia, "Wipe off your tariff on English manufactured goods, do away with your tariff on Bradford woollens, on Leicestershire hosiery and on iron and steel goods"? If he is only going to say, "Give us a preference," the answer is obvious. It will be, "You have a preference already." And if they answer, as I am afraid they will, "We are for Australia first; we are going to maintain a wall high enough to protect our own industries," then what we have to offer is not of any material use.

If, as the result of the discussions with Australia, the right hon. Gentleman says, "I am not satisfied, and I am going back to the House of Commons to ask the Government to impose the 10 per cent. on all your imports which are now exempt," we can understand the anger and indignation there will be in Australia. On the other hand, the right hon. Gentleman may make a bargain with New Zealand and fail to make a bargain with Australia, and there will, in consequence, be an unhealthy differentiation which will weaken the common bonds of tradition and of history. [Interruption.] Yes, tend to weaken them rather than to strengthen them. What will happen as regards South Africa? The products of South Africa are entirely different from those of Australia. South Africa produces a large range of commodities, many of which are essential to our industries and to the food of our people. Now they come in free. The South Africans take a very narrow view of their economic future. They value even more than Australia their economic independence. If, as the result of the discussions at Ottawa, the 10 per cent. concession is maintained for Australia and withdrawn from South Africa the stimulus to South African nationalism will be great. There, again, I see a difficulty.

What my hon. and gallant Friend's Amendment aims at, whatever it may say, is to show that the only practical way of bringing about Empire Free Trade is to have Free Trade inside the Empire. That is a thing we can understand. Lord Beaverbrook is perfectly right. The idea that we can build an Empire on the haggling of the market place, on bargaining and counter-bargaining, on granting concessions to Australia and withdrawing them from South Africa, on a tax on New Zealand butter and a high duty on products of South Africa is wrong; that is the high road to destruction. All the carefully built-up edifice of good will, of a common language, of a common brotherhood which so long has made the Empire one at heart and one in spirit will not be equal to that strain. I agree with the right hon. Gentleman when he says that the Dominions gave freely of their best life and limb in our hour of trouble. There was no question then of bargaining. What we Free Traders, who have been opposed for a generation to this artificial cement of Imperial Preference, say, is that it is much better to keep the Empire together by the bonds of kinship, the kinship of a common Empire, the traditions of common history, the love of a common language and a belief in the principle of liberty and of a Parliamentary system common to all, rather than try this dangerous experiment of haggling about 10 per cent.

Earl WINTERTON

I have listened with great care to the speech of the hon. Baronet the Member for South-West Bethnal Green (Sir P. Harris), and his elaborate attempt to throw over his hon. and gallant Friend the Member for North-East Bethnal Green (Major Nathan), which did not succeed. At the same time, I do not think his speech had anything to do with the Amendment. He gave us an account of the personal connection of his family with New Zealand. No doubt that is important, but much less important than the subject of this Amendment, which, as my right hon. Friend the Secretary of State for the Dominions has pointed out, is very important indeed. It deals with a subject on which there is, very properly, a good deal of sensitiveness in the Dominions. My right hon. Friend dealt so effectively with the speech of the hon. and gallant Member who moved the Amendment that I do not propose to say much about the Amendment itself—I rose only for one purpose, to correct a misstatement made by the hon. and gallant Gentleman—but I would like, with all respect, to say how very much I agree with what was said by the Secretary of State for the Dominions, and so, I think, did the majority of Members in the Committee.

Let me say to the hon. and gallant Gentleman that it is all very well for the purposes of what is, I think I may say without offence, a Parliamentary "rag" to bring forward Amendments of this character, but he ought to have some sense of responsibility, and to realise what the effect of his statements and his Amendment may be in the Dominions. We all know that the hon. and gallant Gentleman and those supporting him, incited and encouraged by some Members of His Majesty's Government, are doing all they can to destroy this Bill. That is obvious, and they are entitled to do so, but they are not entitled to make the kind of speeches they made this afternoon regarding the Dominions, nor are they entitled to make statements such as one which the hon. and gallant Member made which is literally not accurate, which is the reverse of the truth. He said all those here who are in favour of Lord Beaver-brook's policy must necessarily vote for the Amendment. On the contrary, Lord Beaverbrook made it clear, in the enunciation of his policy, that he did not ask for any bargains. He made it perfectly clear that he did not wish us to impose any conditions, but to allow the goods of the Dominions and the Colonies into this country absolutely free. Therefore, the hon. and gallant Member has attributed to Lord Beaverbrook the exact opposite of what he said.

Major NATHAN

Does the Noble Lord suggest that Lord Beaverbrook's policy is directed towards establishing one-way traffic only in Empire Free Trade?

Earl WINTERTON

Not all all. What Lord Beaverbrook said in the course of his enunciation of the policy—[AN HON. MEMBER: "Which one?"] If the hon. Member is not familiar with it, I am not prepared to make him familiar with it. Lord Beaverbrook said he did not wish to see any bargaining on the part of this country with the Colonies and the Dominions in this matter. He said we should offer them certain advantages, and he believed that we should get certain advantages in return, but he specifically objected to anything in the nature of bargaining. Personally, I am in favour of the Government policy, which seems to me to be a very reasonable one, but the hon. and gallant Gentleman has no right to attribute to Lord Beaverbrook views which he did not express, or to say that we shall be inconsistent if we support the Government. Also I wish to say, and I am sure I am speaking for many of my hon. Friends—not only for Members of the Conservative party, but other Members supporting the National Government—that we had believed that people returned to support that Government were going to show a reasonable support of the Dominions and the Colonies, and that has not been shown by the hon. and gallant Member and his friends.

Major NATHAN

I must interrupt the Noble Lord, because otherwise his statement might be open to misinterpretation. I did not stand as a supporter of the National Government at the General Election. I stood as a Liberal and as a Free Trader, without ambiguity.

Earl WINTERTON

I apologise if I wrongly attributed to the hon. and gallant Member support of the National Government at the last election, but I think that if some of his hon. Friends who are supporting this Amendment had announced at the time that they intended to take up the attitude which they have now adopted they would not have got into this House. In conclusion, I wish to say only that the hon. and gallant Member and those associated with him are politically speaking atavistic; they are throwbacks to the time when the Liberal party was bitterly hostile to the existence of the Empire and sneered and jeered at it on every occasion.

4.30 p.m.

Mr. J. JONES

We have been witnessing a very interesting dog-fight. Some hon. Members are now beginning to repudiate the auspices under which they entered this House. After all, I am one of those who came into this House without the blessing of the doctor—I had no mandate, except the old one, the mandate of the class to which I belong. In this particular case we have an Amendment moved by a major dealing with the Empire and the Dominions beyond the seas. I suppose that in that Amendment he includes India. India must have consideration in this matter of Preference. Does he believe that factories in the East End of London ought to be closed on account of Indian competition? I live in a constituency, and represent it, where the introduction of coir matting is putting workers out of employment. Two factories have been closed already as a consequence of the competition. Does the hon. Member agree that those things should be allowed to come in free because they come from countries which happen to be members of the Empire—with a big accent on the H? I cannot pronounce it as well as the Dominions Secretary—[Interruption.] What I want to point out is that we are international Free Traders, under conditions; the conditions are that we shall have some right to say in what circumstances the goods are produced in the countries from which we get them. That has been our policy all the way through. We do not object to meeting other people on fair terms. We do not abject if the hours of labour and the conditions of employment are as good as we think they should be, but that is going a long way in the direction of trying to solve a problem which is at present insoluble.

The hon. Baronet the Member for South West Bethnal Green (Sir P. Harris), who talked about his parents in New Zealand, knows as well as I do that it is impossible for us to meet their competition inside their own market. Everyone knows that only certain goods can go into the Australian market under fair conditions. I cannot argue whether it is right or wrong. I am not blaming the Australians or the New Zealanders, but I say that we have no right to hold the baby for other people, if the conditions of labour in their countries are not more or less equal to our own. I am not an Imperialist in the sense that some of my hon. Friends are; I am only one of those common or garden people who believe that we have to realise the fact that we have failed. Your fiscal systems, Free Trade and Protection, are absolutely barren of passibility of solving the problem with which we are faced. It is impossible in existing circumstances to solve this problem by any gerrymandering with tariffs.

In every country you have the same position, unemployment growing in relation to population, consumption not keeping pace with production, production outrunning consumption in every case. How in the name of Heaven, by this playing about either with Free Trade or Tariff Reform, are you to solve the problem of unemployment? You cannot. Every day that goes over our heads sees us in the same position. Therefore, I suggest that this Amendment, although it has been moved religiously, as an article of faith, by the 12 apostles who are still left, and by one of the descendants of the original apostles—[Interruption.] I was only wanting to say, so far as we are concerned, that we have no time for it. It takes us nowhere. It does not solve any of our problems; it leaves us just where we were before this Bill was introduced. I hope that the Labour party are not going into the Lobby to support an Amendment of this character, even if the hon. and gallant Member who moved it should have the courage to carry it to a Division.

Mr. DAVID MASON

I want to offer a few observations, and especially to call the attention of the House to what I think is deserving of the most severe censure, the language of the speech which has just been delivered by the right hon. Gentleman the Secretary for Dominion Affairs. He must know that what he says is liable to be telegraphed abroad, and for him to make a statement that the speech of my hon. and gallant Friend the Member for North East Bethnal Green (Major Nathan) was an insult to the Dominions, deserves, I think, the most severe censure. What is the right hon. Gentleman going to Ottawa to do? To negotiate? Does the right hon. Gentleman suggest that when the Dominions do not allow our goods to go in free to their country, that is an insult to the old country? The thing is ridiculous. It was childish to get up in a patronising manner and suggest to my hon. and gallant Friend that Ids speech was an insult to the Dominions. Nothing, I am sure, was further from his thoughts. He may err—we all may err; even the right hon. Gentleman may err but for him to suggest that that speech was an insult is something that deserves, and I hope will receive, the most severe censure.

As the right hon. Gentleman is going out to Ottawa to negotiate, and as that was the object of my hon. and gallant Friend in moving this Amendment, I fail to see that any criticism by the Noble Lord the Member for Horsham (Earl Winterton), was necessary, and his personal references to my hon. Friend the Member for South-West Bethnal Green (Sir P. Harris), seemed to me to be very undesirous and in very bad taste. If my hon. Friend, as I imagine, is justly proud—

EARL WINTERTON

May I suggest, as the hon. Member has referred to me, that he should put down a Vote of Censure on the Dominions Secretary and myself, for our execrable taste in referring to a member of the Liberal party?

Mr. MASON

I will consider that suggestion. I was saying that my hon. Friend may be justly proud of his family connections with the Dominions, and he is entitled to refer to those connections in showing what are the relations of his family with the Empire. This Amendment strikes me as carrying out the principle which the Secretary of State for Dominion Affairs is going out to Ottawa to practise, namely, to negotiate, and as such, it seems to be quite in order.

Vice-Admiral TAYLOR

I strongly object to the wording of this Amendment. Undoubtedly, it is a great slap in the face for the Dominions. If it were carried, there would be no Ottawa Conference. The conditions which this Amendment would impose upon the Dominions would be impossible for them to accept. It is well known that the proposals put forward by the Mover of this Amendment are impracticable and impossible. Nobody has ever suggested, however ardent an Empire Free Trader he may have been —and the Mover of the Amendment referred on several occasions to Empire Free Trade—that all manufactured articles from this country should go into the Dominions absolutely free. The ideal towards which we are working is to bring about Free Trade within the Empire. This is the first step, and is the first opportunity that this country has had, thanks to the change in her fiscal policy, to show to the Empire that we intend to do for them what they have been doing for us for the last 30 years.

The hon. Member for South-West Bethnal Green has suggested to the Committee that the preferences given in Australia were of no use. I think that was a very mean proposal to make, because I believe that it costs Australia about£7,000,000 a year, whereas she might save money by buying foreign goods at a cheaper rate. The Chancellor of the Exchequer has inserted in his Bill that food and raw materials from the Empire shall come in here free, and his action has had a great psychological effect throughout the Empire. It will create an atmosphere at Ottawa which otherwise would not be there. I hope all the delegates from the Dominions will persist with that spirit of giving towards this great policy of Empire as much as they possibly can, and in which I also hope that bargaining will be left out, as far as it is possible to leave out bargaining. The Noble Lord the Member for Horsham and Worthing mentioned Lord Beaverbrook, and said that there should be no bargaining. There must obviously be some bargaining in the end, but bargaining should be the last resort. Giving towards the common pool of an Empire policy should be the first aim of those who take part in the Ottawa Conference.

If we restrict goods from foreign countries, then there is room for the home production of food, and for the food and raw materials which we receive from the Empire. The whole object of this policy is to increase the selling power of the Empire by giving her greater markets here. By increasing her selling power, she will increase her purchasing power for our manufacturing industries, because it is the great Dominions who buy manufactured articles from this country. They will thereby assist to create employment in this country. The further policy, the development of those Dominions, is one which will absorb a greater population and by absorbing some of the population of this country, will help emigration, the necessity for which is a very serious problem facing us to-day. If we do not give our Dominions an increased market in this country for their products, there is no Empire policy at all. We have to face the fact that an Empire policy depends entirely upon our taxation of foreign food and foreign raw materials, and that if we are not prepared to accept that principle and put it into practice to the fullest possible extent, there will be no great inter-Imperial policy at all.

The Dominions are, as is well-known, far and away our best customers. They are most anxious to increase their trade with us, but unfortunately we have been losing our proportion of trade with them. America has been taking our place to a certain extent. At the Ottawa Conference there is not the slightest doubt that we shall be able to make arrangements whereby this country will be able to obtain a greater proportion of the trade, and take from the foreigner the trade that he is doing with the Empire at the present time. That can only be done if we are prepared to give a market in this country for Dominion products of food and raw materials.

Mr. CHAMBERLAIN

I want to make an appeal to the Committee to come to a decision on this Amendment now. We have already spent a very long time upon it, there are many other matters of great importance to be discussed, and I cannot think that the convenience of the Committee will be disturbed if we now come to a decision.

Amendment negatived.

Mr. CHAMBERLAIN

I beg to move, in page 6, line 18, after the word "from," to insert the words "any part of the British Empire."

Sir HUGH O'NEILL

There is one small point in connection with this Amendment which I would ask the Chancellor of the Exchequer to make clear. The Amendment really raises the same point that we decided a few moments ago on another Amendment of his. The matter is one which affects considerably my own constituency, and the part of the country in Northern Ireland which I represent. I take it that the effect of the insertion of the words "any part of the British Empire" would be that goods or raw materials coming from the British Empire, although they are subsequently altered by some kind of manufacturing process, will not be subject to the 10 per cent. duty. Let me take the case of maize as a specific example. Maize at present is to be subject to the 10 per cent. duty, but, if maize comes, for example, into the Irish Free State, it will not be subject to a 10 per cent. duty. I believe that in that Dominion there are many mills where maize is converted into meal, and I should like to ask whether, after this Amendment, any maize corning into the Irish Free State and being manufactured into meal, would or would not then, as a manufactured article coming from a Dominion, be subject to a 10 per cent. duty on entry into the United Kingdom?

Mr. JANNER

There is a point which struck me in connection with the right hon. Gentleman's previous Amendment, and which applies equally to this Amendment. I cannot understand what is going to happen if the legal interpretation of the words "consigned from' is going to be questioned in a court. It appears to me that, if this provision applies to goods consigned from any part of the British Empire a position such as the following might arise. Goods from, say, Cyprus might be consigned to Port Said—an independent port—warehoused there, and subsequently consigned from there to this country. If it be a fact—I am merely giving it as an illustration—that Port Said does not come within the definition "British Empire," a peculiar anomaly would arise. Shippers who would not accept a bill of lading direct from Cyprus would require an entirely fresh consignment from the other port, and, if the word "consigned" is going to be held to mean that goods consigned from a fresh port are goods consigned within the meaning of this Subsection, there will he difficulties, and the whole intention of the Sub-section might easily be defeated. You might have goods sent direct from Cyprus by a Greek steamer to this country, but, on the other hand, you might have goods sent from Cyprus to Port Said by a Greek steamer, a P. and O. liner might take up the goods at Port Said, and it might very easily be said then that the goods, being consigned from. Port Said, were not entitled to the preference that is intended. I do not desire to make any comment in regard to the advisability or inadvisability of the preference, but I should like to ask whether the wording could not be amended so as to make the meaning of the word "consigned" more clear. It may be that the place which I have taken as an example, namely, Port Said, is not one which does not come within the term "British Empire," but certainly cases could and would arise where there would be transhipment from a port which does not come within the British Empire.

Mr. CHAMBERLAIN

I do not think that the point raised by my right hon. Friend the Member for Antrim (Sir H. O'Neill) really arises out of this Amendment of mine. The Amendment is designed to deal with the case of goods produced in one part of the Empire and consigned from another part of the Empire. The case to which my right hon. Friend has referred, namely, that of maize from a foreign country coming into Northern Ireland and being there manufactured, and coming to this country from there, comes under the Bill as it stands, but does not come under my Amendment. Of course, it is perfectly clear that the maize of which my right hon. Friend speaks will have been manufactured in Northern Ireland, and will have been consigned—

Sir H. O'NEILL

I beg my right hon. Friend's pardon; I was speaking about the Irish Free State.

Mr. CHAMBERLAIN

I am sorry; I am afraid I did not understand.

Sir H. O'NEILL

I was asking what would be the position when foreign maize came into the Irish Free State, where, I believe, it would not be subject to any 10 per cent. duty, and was then turned into a manufactured article, namely, meal, and, as meal, consigned to the United Kingdom. Would that meal, coming from a Dominion but made out of a foreign product, be subject to the 10 per cent. duty on entering the United Kingdom, or would it not?

Mr. CHAMBERLAIN

That would depend upon whether a preference was given to the Irish Free State or not on goods coming from the Free State. The point raised by the hon. Member for Stepney (Mr. Janner) is, I think, only the same point on which I gave an answer earlier. If goods produced in any part of the British Empire are consigned through from the British Empire to this country, then they will take the preference which applies to the country of origin; but, if the voyage is broken on the way, and there is a new consignment from a foreign port, such as Port Said, in that ease, of course, the preference is lost.

Mr. AMERY

Is it not a very material issue that, in the case of certain parts of the British Empire, direct through consignments may be almost impossible, owing to the way in which the shipping lines run? In the case of Cyprus, which has been mentioned, there is very little direct shipping, consignments from Cyprus going very largely to Alexandria and Port Said to await re-consignment. Ts it not desirable, for the purposes of this Measure, that the use of the word "consigned" should be avoided, and some such phrase as "country of origin" be substituted? After all, a mere technical breach of continuity is no reason for denying preference to the products of a Dominion or Colony provided that we can be sure of their origin.

Mr. CHAMBERLAIN

Is not my right hon. Friend confusing transhipment with re-consignment? You can have transhipment without a fresh consignment.

Mr. AMERY

That may depend on circumstances. In some cases an article is just consigned to an agent in a place like Port Said, without any absolute certainty as to how much of the total quantity sent there is eventually consigned to the United Kingdom, and, surely, it would not be desirable that goods which were sent to an entrepot port like Port Said should be denied the advantage of the preference due to their origin. All that I would ask is that the wording of the Bill should be carefully considered, so that the origin of the goods rather than a technical difference between transhipment and re-consignment should stand as a bar to preference.

Mr. JANNER

This question of goods being consigned from a certain port arises with regard to the shipping companies which undertake to carry those goods, and the term "consignment," as my learned Friends in the House know, has been discussed at length in the courts. P. and O. liners, for example, will not accept a consignment direct from Cyprus, but would ask to have a distinct bill of lading of their own from Port Said to this country. My object in raising the matter was merely to assist, if I could, in getting the Sub-section refrained to some extent, in order that it may include all commodities which it is not intended to exclude. Clearly it is not intended to exclude such commodities as I have referred to, but I believe that the ultimate result of this Amendment is likely to be considerable trouble in carrying into effect that which is desired.

Mr. NUNN

Does not the term "consignment" imply a commercial trans- action? That is so in connection with the international Customs, where the last place of consignment means the last place where a commercial transaction took place. I should imagine that that would be the use of the word in this Bill, and certainly it is the official practice in connection with the Customs Department.

Sir NAIRNE STEWART SANDEMAN

If Canadian wheat goes to be milled in bond in the United States, and is then sent over here, would it be subject to duty or not?

Sir S. CRIPPS

I am sure that the right hon. Gentleman does not want to put an unnecessary tax on Colonial goods. As I understand it, the whole basis of this proposal is that goods bona fide produced in a Colony shall come into this country free of tax, and I am sure that we all agree with that. I am also certain, however, that many kinds of goods produced in our Colonies, especially in some of the smaller ones, will, as a result of this Bill as it now stands, have to suffer a tax. Mention has been made of Fiji, where all the production is collected by New Zealand merchants. It is not consigned direct from Fiji to this country, but the consignments are made up and the sales take place in New Zealand. When such goods—copra, for example—are consigned from New Zealand to this country, unless there has been an arrangement between New Zealand and this country as regards copra not paying any tax under this Section, those goods coming from a Colony will be taxed. I am sure that the right hon. Gentleman does not want to bring about that result, and I am sure that, if he would be good enough to reconsider this question before Report, words could easily be devised which would enable the commissioners, on being satisfied, not as to the consignment but as to the genuine origin of the goods being correct, to allow them to come in free of duty.

5.0 p.m.

Mr. CHAMBERLAIN

I am not sure that I agree with the hon. and learned Gentleman in the illustration that he gives. It seems to me that, if a Colony sells to a Dominion, it cannot expect to get something more than the Dominion would get itself. It is very likely, in the particular case which he mentions, that an arrangement would be made with the Dominions that a particular article should come in free. I think the general principle which we have laid down is sound. Where it is a through consignment to someone in this country, the article takes the preference that applies to the country of origin. If a Colony sends goods to some foreign port, let us say, and waits to see what the best market is, the British or some other, I do not think that they are entitled to claim the same advantages which they would have if they had consigned direct. It is rather a technical matter I admit, and I should be very ready to look into it again and see if anything further is required, but up to the present it seems to me that we are on the right lines and, of course, the hon. and learned Gentleman will appreciate that we have to be rather careful that this preference is not taken advantage of by countries which pretend that they are their own goods when they really are not.

Mr. J. JONES

Will the right hon. Gentleman consider the advisability, in view of the preference that is to he given to the Colonies, that all goods consigned to Great Britain shall be carried on British ships?

The CHAIRMAN

That question does not arise on this Amendment.

Amendment agreed to.

Further Amendment made: In page 6, line 28, at the end, add the words: (4) Where by virtue of Sub-section (2) of this section any duty under this Part of this Act becomes chargeable on goods grown, produced, or manufactured in any country to which this section applies, goods consigned from that country shall, unless they are goods of a class or description specified in an order made with respect to that country under the last foregoing Subsection, be treated for the purposes of this section and of any order made thereunder with respect to any other country and for the purposes of the next following section of this Act as not having been consigned from a part of the British Empire."—[Mr. Chamberlain.]

Motion made, and Question proposed, "That the Clause, as amended, stand part of the Bill."

Mr. RAMSDEN

May I ask if my Amendment, to omit the Clause, cannot be moved?

The CHAIRMAN

That is not an Amendment in Committee. I have put the Question, That the Clause, as amended, stand part of the Bill." If the hon. Member wishes to discuss or oppose this Question, he can do so.

Mr. RAMSDEN

Before we accept the Clause, I think we should have a further statement with regard to the attitude of the Government. I should like to know, in particular, what steps they propose to take between now and the Ottawa Conference in order to ensure the success of that conference. It appears to me that it is not going to be successful because speeches are made which are full of enthusiasm, such as those which I am sure will be made by the Secretary of State for Dominion Affairs, but because the work has been thoroughly prepared beforehand. I should certainly like to have a statement from him as to what is being done.

The CHAIRMAN

I do not think I could allow the right hon. Gentleman to do that, and therefore I do not think I can let the hon. Member proceed.

Major LLOYD GEORGE

Small as we may be, I suggest that we have a right to put our position perfectly clearly. The Secretary of State for Dominion Affairs told my hon. and gallant Friend the Member for North-East Bethnal Green (Major Nathan) that in his Amendment he was treating our Dominions as foreigners. I do not agree with him. My opinion, at any rate, with regard to preferences is that, while I always have been against them and against tariffs, now that we have to have them, let us do as little as we can to injure British trade, because it is from a lack of that we are suffering at the moment. If I may put it the other way, do not let us treat the Dominions as foreigners, but let us, where we can, treat foreigners, as far as trade is concerned, in the same way as we treat the Dominions. Anxious as I am, and as anyone else in the House is, to see a consolidation of the British Commonwealth of Nations, I do not see why we should be asked to do things which are going to hit us, being already pretty hard hit, and, while I have no intention of scoffing at sentiment, we ought to remember that we want more than sentiment in order to get employment for British people.

One would think, judging from what one hears when Dominion preference is being discussed, that this country does nothing for the Dominions at all. We ought to face facts. I have looked through certain percentages of trade between the Dominions and ourselves, because we are always being told that we ought to do more for the Dominions. I find that the percentage of the British export trade consigned to the Dominions is as follows. The figures are for 1929. They are probably a little different now, but in the main they will be the same. To Canada we consign 5 per cent. of our export trade, to Australia about 7 per cent., to New Zealand about 3 per cent., and to South Africa just over 4 per cent. The percentage of the imports from the Dominions consigned to the United Kingdom is 25 per cent. from Canada, 38 per cent. from Australia, 75 per cent. from New Zealand and 49 per cent. from South Africa. Those figures do not go to show that the Dominions are doing badly as far as trade with Britain is concerned. They show that, with regard to two of them, practically most of their trade is done with us, and yet the percentage of our trade done with them is, compared with our total trade, very small.

Whether we like it or not, we cannot help being in the position that we are geographically. It is out of our control. Whether we like it or not, we are very close to Europe, and it is no wonder that a very large proportion of our trade is done with Europe, and I should say the largest proportion of our shipping certainly is concerned in shipping goods to and from European countries. In the same way Canada, whether she likes it or not, is closely approximate to the United States and, quite naturally, has to do most of her trade with America. The Dominions tell us—we have had ample proof in statements made in the last few weeks—that they must come first. I am not complaining in the least that they do. They say Canada must come first, Australia must come first, and South Africa must be considered first, and after that we will see that Britain gets the best preference. I do not know whether I shall be saying something very terrible, but is it an awful thing for us to suggest that Britain may come first, too? I have a vivid recollection of a speech made by the President of the Board of Trade in this House about two years ago. He said: Just as the first duty of Ministers in the Dominions must be to look after their democracy, so the first duty of our Ministers here must be to look after the interests of our democracy, It is of no use to say to those who are seeking employment, and are finding it extremely difficult to get work, that, in the interests of the Empire, they must make sacrifices. The fact is that we cannot afford to surrender any of our foreign trade. That is the truth of the matter."—[OFFICIA L REPORT, 9th July, 1929; col. 782, Vol. 229.] That speech was made when unemployment was somewhere in the neighbourhood of a million. We know what our position is to-day. I should have thought those remarks would carry very much greater weight to-day than they did two years ago. I do not think this country can afford to make any sacrifices at the expense of its own people. Ever since the War we have been going through very trying periods, and we have never participated in any of the booms that have occurred in other countries. I think we ought to put the interests of our country first. We do a large proportion of our trade with Europe. We take a very large proportion of Dominion exports, and they, in comparison with the rest of our world trade, take a very small proportion of ours and, with regard to the treatment meted out to us by the Dominions, I think a good deal of harm is done at our Dominion Conferences by not having a plain talk. Sentiment is important, but you must come down to facts. Where we get better treatment from foreign countries I do not see why we should not gay so.

I do not want to treat the Dominions as foreigners, but I should like to see those who treat us favourably given just as good treatment as the Dominions, because they are giving employment to our own people. May I give certain comparisons with regard to the treatment that we get from foreign countries and from certain Dominion Governments. There are many examples, but I will give only a few. Steel rails are let into the Argentine free. There are certain corrections to these figures that I am going to give, but, I understand, not to a large extent. They are for 1930, and they are the latest that I could get hold of. In Australia British rails are charged 50s. a ton duty.

Mr. HOWARD

How much are foreign rails charged?

Major LLOYD GEORGE

I am not concerned at the moment with that. I am concerned with the treatment that British goods get from our Dominions, and whether the foreigner is treated worse makes very little difference if the door is shut in your face. It does not matter whether you are 100 yards or 2 inches outside the door as long as you are outside. That is one of the objections that I have to the bargain that is offered by us to the Dominions when they put a prohibitive tariff on British goods and then say, "We will raise the tariff on the foreigner if you give us Preference." If we are prohibited, it is very little advantage if the foreigner is prohibited, too. Oil engines are let free into the Argentine. There is a 55 per cent. duty in Australia and 15 per cent. in Canada. On heavy engines the Argentine charges 5 per cent. and Australia 40 per cent. With regard to boots and shoes, a trade which is not in a very flourishing condition at the moment, the Netherlands allow them in at 8 per cent. duty; France 12 or 15 per cent.; and the United States 20 per cent. South Africa puts on a ditty of 30 per cent., New Zealand 30 per cent., and Australia 67½ per cent. This is against British manufactured goods. I could go on with a number of other articles. The point I want to make is that, where foreign countries treat us better than the Dominions, as they do in certain articles, we ought to allow them to come in on the same terms as the Dominions, because we simply cannot afford to lose any trade at present anywhere. What we are suffering from mostly is loss of export trade. Our drop in shipping returns is contributing very largely to our adverse balance of trade, and I do not think we ought to throw away any trade we can possibly get, wherever it may come from, which is going to give employment to our people.

May I say one word about the Argentine? They are very good friends of ours commercially. They take a large export trade from us, and we take a large trade from them. But an enormous part of the development of the Argentine has been carried out by British capital, and a very large proportion of our invisible exports comes in interest from the Argentine. Take the case of South Wales and other coal exporting districts. One of the most important factors in the successful com- petition of British with foreign coal in the Argentine is that our ships bring goods back, thereby reducing the freight that we have to charge on coal going out. If we are not going to treat countries that take coal from us, like the Argentine, on a decent basis, they cannot take our coal. They will go elsewhere. The ships which take the coal bring back wheat and other things, and everything which we stop from that country will hit our trade at home. For what purpose do we develop a country? It is developed in order to bring produce here.

An enormous part of the capital raised for developing countries like the Argentine is spent in this country upon rails, locomotives, carriages and so forth. They treat us very well. What are we doing in return I We send trade commissions out there to encourage Anglo-Argentine relations. We held a great exhibition there last year, broadcast all over the world, to encourage Anglo-Argentine relations. Yet we are going to say to them, "We know that you treat us well. We know that you treat us better in some things than even our own Dominions, and yet you will not be treated in the same way as our own Dominions are being treated." My object in rising is to appeal to the Government, that when they are negotiating, not only with the Dominions but with any country, they will bear in mind those countries which are treating us at the present moment in a very favourable manner.

Vice-Admiral TAYLOR

Australia is buying from this country twice as much as the Argentine, and she has a population 3,500,000 less than the Argentine. The Argentine has a trade balance in her favour of £43,000,000 a year, and is not such a good customer as Australia.

Major LLOYD GEORGE

The hon. and gallant Gentleman is speaking about a visible balance, which is a very different thing, as we have heard during the last few days, from an invisible balance. I suggest that the amount of capital invested by British shareholders in the Argentine brings in a better trade balance.

Vice-Admiral TAYLOR

That invisible balance will be brought in whether goods are shipped from Argentina, or from any other country.

Major LLOYD GEORGE

I am all in favour of that, but I am simply trying to point out to the hon. and gallant Gentleman that Australia has higher duties on certain commodities than the Argentine.

Vice-Admiral TAYLOR

But they buy twice as much.

Major LLOYD GEORGE

I do not think that the hon. and gallant Gentleman and I would ever agree, but I would point out that he is probably talking about trade per head of the population.

Vice-Admiral TAYLOR

Not as regards Australia actually.

Major LLOYD GEORGE

Actually, if you like. If it is a question of taking trade per head of the population, I would point out that the Scilly Isles probably take more British goods per head than any country in the world. What we have to consider is aggregate trade, and we canot afford to lose any trade in any part of the world, as we are in such a serious position ourselves. I ask the Government when they begin their negotiations favourably to consider those countries who treat us well at the moment.

Mr. J. H. THOMAS

It was only in his last sentence that I appreciated what the hon. and gallant Member for Pembroke (Major Lloyd George) was after. He rather rebuked me for my treatment of the Mover of the Amendment but I observe that he kept very quiet when the speech which he rebuked me for dealing with was being delivered. It at least enabled me to come to the conclusion that he was not associating himself with that Amendment.

Major LLOYD GEORGE

I objected only to the remark the right hon. Gentleman made about my hon. and gallant Friend wanting to treat the Dominions as foreigners.

Mr. THOMAS

My hon. and gallant Friend evidently did not hear all that the hon. and gallant Gentleman said. If he did I am sure that he would agree that I dealt with it in the right way. At all events, I hasten to give him the assurance for which he asks. I will sum it up in this way: He says, "As far as we on this side are concerned, whatever our fiscal views may be, we want the Government to lose no chance of doing business whether with the Dominions or with foreign countries." I hasten to assure him that that will be our policy, but in granting the Preferences under review at the moment, we believe that that is the first and necessary step to be accomplished. We believe that it will be accepted by the Dominions as a clear and definite intimation on our part that we want to do business with them. We are clear and definite about this, and we shall say so.

My hon. and gallant Friend is under a misapprehension if he assumes that there is not plain speaking at these conferences. The Dominions make their policy perfectly clear, and we cannot complain, but we are entitled to say to them, and shall say to them, "It is no good talking about a Preference if the fence is so high that no one can climb over it." I ask him to remember that in making it perfectly clear, as we do now, that these preferences are given with the deliberate intention of creating an atmosphere necessary for the success which we hope to achieve at Ottawa, we shall not be unmindful of the obligations of our own country, neither shall we forget our duty with regard to world trade even after that. That is the spirit in which the Government will approach the Conference, and it is the spirit which, I believe, will tend in the end to succeed.

Question, "That the Clause, as amended, stand part of the Bill," put, and agreed to.