NEW CLAUSE —(Rebate of the excise duty on home-grown sugar used in confectionery and sweetened milk products.) (Hansard, 11 June 1934)

§ Mr. LENNOX-BOYD

I beg to move, "That the Clause be read a Second time."

The purpose of the Clause is to provide an opportunity of encouraging the manufacture in this country of condensed and sweetened milk products; and at the same time to do something to provide 1508 for utilising the surplus milk from the milk farms of England. The result of the Clause will be that where home-grown sugar is used in the manufacture of condensed milk products, the manufacturer shall be granted a rebate equal to one-half of the Excise Duty on home-grown sugar the main rate of which is 5s. 10d. per cwt. Under the Import Duties Act a duty of 10 per cent. is imposed on all goods other than those on the Free List which were not already subject to a duty under another enactment. Therefore, in general, the Import Duties Advisory Committee are unable to deal with any goods already dutiable, and they are unable to deal with goods containing sugar. But under Section 8 of the Import Duties Act there is a provision in connection with composite goods, that is, goods consisting partly of dutiable and partly of non-dutiable goods. The Committee is free to deal with such goods, and under the Eighteenth Order made under the Import Duties Act a measure of protection has been extended to many articles containing sugar which, prior to the coming into force of this Enactment in September of last year, were only subject to a revenue duty. But where the revenue duty on composite articles exceeds 10 per cent. of the whole value of the article the Import Duties Advisory Committee can take no action. As a result, skimmed condensed milk imports into this country, which reached very considerable figures indeed, cannot be dealt with, because the sugar content duty already exceeds 10 per cent. of the total value of the commodity imported. It is a matter of very serious consideration not only to the manufacturer of skimmed condensed milk in this country, but still more to the home dairy farmer, that something should be done to deal with this anomaly.

I hope that my right hon. Friend will, if he cannot on this particular occasion give them friendly consideration, bear in mind the arguments I have tried to advance. The imports last year of skimmed condensed milk approximated to. the figure of some 2,000,000 cwt. They are equal, I believe, to the milk imports of some 120,000 cows, and represent the equivalent of some 70,000,000 gallons of fresh milk every year. Those of us who are very much concerned with the difficulties confronting the Milk Marketing Board hope that some such Clause as this 1509 may be inserted in some future Finance Bill. It is clear that the bulk of the competition to-day comes from the Netherlands, and, as my right hon. Friend will be aware, an Act was passed last year in the Netherlands—the Nether-land Crisis Dairy Act—by which a levy is raised on butter in the Netherlands in order to subsidise milk used for manufacture. In this country at the moment we are at a severe disadvantage in having to meet the competition of subsidised condensed milk from the Netherlands, and, as a result, not only is our home agriculture jeopardised, but the manufacture of condensed milk in this country is put under a grievous handicap.

Mr. HORE-BELLSHA

I congratulate the hon. Member on the brevity and conciseness with which he has moved the new Clause. The effect of it would be to give British manufacturers of confectionery and sweetened milk products who use home grown sugar a rebate of half the duty paid thereon. The loss to the Exchequer would of course be considerable; at a rough guess it would not be less than a sum of six figures. The question arises as to whether the concession should be confined to makers of confectionery and sweetened milk products. There are other important users of sugar, jam makers, biscuit makers, but in any event my hon. Friend 1510 is aware that the home grown sugar industry is now being investigated by a special committee, and perhaps he will agree that nothing should be done in the way of piecemeal relief. I hope he will not think me discourteous if I do not give him a fuller reply, but the elements of a full answer are in what I have said.