SUPPLY.

HC Deb 07 May 1934 vol 289 cc836-86

Again considered in Committee.

[Sir DENNIS HERBERT in the Chair.]

Postponed Proceeding resumed on Question proposed on consideration of Question, That a sum, not exceeding £36,618, be granted to His Majesty, to complete the sum necessary to defray the Charge which will come in course of payment during the year ending on the 31st day of March, 1935, for the Salaries and Expenses of the Department of His Majesty's Secretary of State for Dominion Affairs.

Question again proposed, "That a sum, not exceeding £36,518, be granted for the said Service."

8.21 p.m.

Sir R. HAMILTON

When we were interrupted for Private Business, I was about to draw the attention of the Secretary of State to points which I think deserve his attention. I am sorry he is not on the Front Bench at the present moment, for they are difficult legal points, but I hope they will be reported in the OFFICIAL REPORT, where they can be studied. In the South Africa Act of 1909, Section 151 provides that the King, with the advice of the Privy Council, may, on Addresses from the Houses of Parliament in the Union, transfer to the Union the government of the territories in question, the provision for good government in the event of such transfer being contained in the Schedule to the Act. There is now legislation pending before the Union Government under which, if it becomes law in its present shape, the Union Parliament will confer on the Governor-General in Council the right to transfer the native territories to the Union, which would indeed be a very anomalous result. If I am correct in drawing that conclusion, the authority of the King in Council under Section 151 of the South Africa Act would need to be safeguarded, and the effect of Clause? of the Bill to which I have referred on the whole power of the King in Council to transfer the territories, obviously needs scrutiny. It is desirable that we should have clearly expressed by the Government that this right will not in any way be impaired.

The last point to which I wish to draw attention is this : The power of the King to disallow Union legislation having gone, the sovereign power of the Union Government renders nugatory the provisions for good government which are contained in the Schedule to the Act in the case of a transfer being made. Therefore, I presume it will be correct to say that, should a transfer be made, provision for good government will necessarily have to be settled by negotiations between the two Governments. These are shortly the points into which I think is desirable that the Secretary of State take an early opportunity of looking and giving an answer upon, because as will be seen they are preliminary points and also points of special importance when the discussions continue, as they probably will, at some future date.

Opinions with regard to the possible transfer of these Protectorates are strongly and widely held in this country. I have very strong opinions myself, but for the reasons I have given I do not consider that this is the proper time at which to express them. We must wait until we know exactly the form in which the Note from the South African Government will arrive here and opportunity is given to this House to have before it all the correspondence that passes between the two Governments. There is an undertaking by the Secretary of State that nothing shall be done without a full expression of views by this House. As I said, I do not consider the present time opportune for an expression of views, and so I will confine myself to asking the Secretary of State to have the points I have raised looked into.

8.26 p.m.

Colonel WEDGWOOD

The situation for those of us who believe in the trusteeship of England over native races is, indeed, difficult at the present moment. A demand has been made upon us by the South African Government—it has not yet reached this country, but we have had particulars of it in the Press—for the surrender of our control over Bechuanaland, Basutoland and Swaziland, and their transfer to the Union Government. Obviously, if that demand had been made by a foreign Power it would have been met with ridicule, but it has been made by one of the Unions of the Crown. But the position of this country as protectors of those natives is made worse by the knowledge that during the past 15 years or more we ourselves, in exercising our protectorate over those countries, have not so far shown the best results of British rule. Our position is the more difficult because South Africa, during the same period, in fact, ever since the South Africa Act was passed in 1909, has been dealing with the native problem in its own country on lines very different from those which are traditionally the lines of the British Colonial Office.

For six years now the Government of South Africa has been sitting in Committee on its great new policy of dealing with the native question in South Africa. The question of segregation, the question of land for the natives, the question of the political rights of natives and the question of their rights of labour have all been under discussion in the Union for six years, and Measures which are repugnant to British ideas have been drafted and redrafted. Though, fortunately, they have in hardly any cases actually been put upon the Statute Book, they have given a clear indication of white opinion in South Africa—perhaps I should say the Northern parts of South Africa rather than the Cape—on the terrible question of native rights and native interests and the future of the natives.

The real difficulty in South Africa is that there is there a large white working-class population which wishes to prevent the Kaffir from competing in their labour market, and at the same time there is a large farmer class and a large class of mine owners, situated in Johannesburg and elsewhere, whose main object is to get that black labour. Consequently, the legislation that is threatened and the legislation that has been passed hits the native from both directions. The white voter, who has little but his labour with which to keep his head above water, has forced through legislation which prevents the black worker from working in many industries and trades. To a large extent he is segregated in native territories, or, if he gets to Johannesburg, confined in the compounds and in the locations, where he is carefully supervised to see that he shall be the least possible inconvenience to the whites and yet shall be readily available as labour.

On the other hand, there are the segregationists, those who wish to put the blacks into their own part of the country and keep them there, preventing them from going in the white labour market. They are willing enough to provide land but not willing enough to pay for it. They are anxious to get the natives away from the white towns and away from the white man's farms and back into the reserves, but without sufficient land in the reserves to keep them alive.

The natives are just acquiring sufficient education—the only chance of education they have is through the missionaries, at Lovedale College and elsewhere—to realise not merely the injustice of their position, but the hopelessness of their chance of getting justice or getting any alteration. The feeling between white and black is probably worse in South Africa than in the Southern States of North America. With this vision of the hopeless position of the blacks in South Africa we are now asked to hand over these three Protectorates, with their native populations, to the same rule that has already reduced to despair the natives of the Union itself. I would sooner hand them over to any Power, but I would much rather we kept those Protectorates and dealt with them on more modern lines. After all, over the greater part of our Colonial Empire particularly on the West Coast of Africa, one can see the enormous benefits that accrue to the natives through British Colonial administration. There they have their land, they have equal rights, they have education of a sort, they have colleges of a sort. They acquire education, and some ideas of civilisation as well. We have done well. We have done better than any other colonising Power, and it would be a scandal if we surrendered those unfortunate natives of South Africa to ideas and to treatment diametrically opposed to those ideas and that treatment which 150 years of English colonial rule have shown us to be best for the natives and for our reputation.

The situation has been made infinitely more difficult now, and it is well to face the facts. The South African Union is, in truth, no longer part of the British Empire. The South African Union drove us to force through this House the Statute of Westminster. The other Dominions have not implemented that Act, but South Africa has, and it gives them a larger degree of independence and of severance from the Empire than was ever contemplated. Now they are to pass this Status Bill—I suppose that it will be passed shortly—making it quite clear that they have no connection with this country. When I was there last it was obvious that in no part of the world, except possibly Ireland, was it more unpopular to be an Englishman. The ties that bind us to South Africa are ties of antagonism, not merely in war and in the concentration camps of the old days, but antagonism based upon completely different ideas of our duties towards other people and the relative roles of black and white and their influence upon one another.

Australia manages the mandated territories of New Guinea, which used to be British New Guinea, admirably. New Zealand does the same in Samoa. It is only in South Africa that you have an example in mandated territory, in the old German South-East Africa, of instinctive antagonism to anything suggested by this House, by British public opinion or by the Government. If this proposal had been made two years ago, or even one year ago, by the South African Government, it is obvious that it could not possibly have been entertained.

The CHAIRMAN

It would be quite in order for the right hon. and gallant Gentleman to discuss a proposal which had been made to His Majesty's Government, but I do not think it can possibly be in order to discuss a hypothetical proposal.

Colonel WEDGWOOD

It is very difficult. We have read about the proposal in the Press, but we have not—

The CHAIRMAN

That is my point. The right hon. Gentleman can discuss what we might call the general principle, but certainly he cannot discuss such a proposal, notice of which has been seen in the Press, because that is not a matter of which notice can be taken till the proposal has been made.

Colonel WEDGWOOD

The immediate responsibility of the Dominions Office rests considerably upon the pledges that have been given to this House, and upon the interpretation of the Government of South Africa Act of 1909. It must be obvious that changes have taken place since, in the relations between England and South Africa, which make the provisions of that Act inapplicable at the present time, and indeed that has hitherto been the attitude taken up by the Secretary of State. He has told us quite definitely that we shall not cede those Protectorates or wash out our responsibility for them except by the free and unfettered decision of this House, and that is a great step forward. He has told us also, and I hope that the Under-Secretary of State will be able to repeat this to-day, that native opinion in those territories will be consulted. On that point it is very important that we should know quite certainly what is meant by consultation, and what attention will finally be given to the wishes of those Protectorates. In many of them there may be a handful of people who would approve of transfer to South Africa. There are always people who see the advantages of being the first friends of the new Government.

It would not be sufficient to be guided entirely by deputations of chiefs from Swaziland, and still less from Basutoland or Bechuanaland. Swaziland is the best of those, bat the government of Basutoland by the chiefs has not been satisfactory, and I do not think that the opinion of the Basutos should be taken solely from a deputation of chiefs. Bechuanaland, where we have recently made such an unfortunate faux pas, is another difficult spot. I hope that the consultation which the Secretary of State has in mind will be by a visiting committee, preferably of the two Houses of Parliament, to those territories, so that the people who make the visit may meet all classes, and have conversation generally in the bazaars and elsewhere, in order to find out what are the true difficulties as well as the true opinions of the natives in those territories.

I know Swaziland, and I know Basutoland and Bechuanaland slightly. They are different countries. Half the people are working for chiefs on the chiefs' land, and the other half work in the mines and on the farms round about. Those classes of opinion have to be consulted and we have to be assured that those people realise the advantages or disadvantages of changing British control for control by a different race and a different Power. That is profoundly important to us, because the prestige of Great Britain all over Africa depends upon our handling of this problem. Every one of the Colonies there, even the settled and happy Colonies on the West Coast, will feel the repercussions of any cowardice on our part, and that will affect our work in those Colonies and the progress of native education and opinion.

This is the greatest danger that British colonial theory and practice have met with, and I beg the Under-Secretary to let his Department realise that they are not a Department to strike a bargain dealing with trade—a bargain based upon safeguards which we know we cannot safeguard. Their business is to go deeper than a mere matter of bargaining, than a mere matter of safety—it is to preserve our policy in the treatment of native races, and to preserve the good name of England, so that it shall not be said in the future that we deserted these people and handed them over, at some advantage to ourselves, to be looked after by another Power.

8.45 p.m.

Mr. MACLAY

I am glad to have an opportunity of speaking for a few minutes in this Debate, because I would like to make one or two remarks from the point of view of a Liberal, though not necessarily of Liberals who are in Opposition at present. I regret very much the fact that I am speaking on the opposite side to some of my late colleagues; I trust that we may be joined up at some time in the future. It was said the other day that an open door is presented to us, and those Liberals who support the Government may return the invitation and the compliment.

I think that the whole Committee, and, indeed, the whole country, will have welcomed the very clear statement which the Dominions Secretary made to the Committee this afternoon. It was time that such a statement was made. This question of New Zealand has been viewed throughout the country in rather an unreal way, and has been made use of rather from a party standpoint than with the realities of the case in view. At the same time I would like to say that I hope the Dominions Secretary, when be receives an offer like this, will give the country an assurance that he is exploring it to the very end. If I might respectfully say so, there was a certain amount of curtness in the reply which lent itself to misunderstanding in the country. I think that, although Free Trade may not be possible to the extreme limit, we should try to give it in as large a measure as we possibly can.

At the beginning of the Debate we had two speeches of what I would call an extremist character, the one from the right hon. Gentleman the Member for Darwen (Sir H. Samuel), and the other from the right hon. Gentleman the Member for Sparkbrook (Mr. Amery). To me the speech of the right hon. Gentleman the Member for Darwen seemed to be an idealist speech, and I think we all agree with his ideal; but, if I might say so, what strikes some of us on this side is that, while we believe in ideals, we are faced with the question of what we are to do in present circumstances; and, while we would like to follow the right hon. Gentleman in his idealism, it is just not practical politics at the moment. He drew the analogy of the Corn Laws 100 years ago, and suggested that the same tiling was being enacted to-day; but, surely, when the Corn Laws were swept away 100 years ago, it was a question of sweeping away duties on something in regard to which this country could never be self-supporting. To-day it is more a question of agricultural products coming into this country in regard to which the country can be self-supporting, and in regard to which we desire to have some restriction and control. I think the right hon. Gentleman was a little unfair in the figures that he gave regarding exports under Free Trade and under Protection. If I remember aright, he quoted the figures for 1929 as typical figures for this country's exports under Free Trade, and then compared them with the figures of the last two years under Protection. Really, however, that is not a fair comparison. In 1929 there was quite a boom, and the depression came long before the country even spoke of tariffs, namely, in 1930 and in 1931, before the question of tariffs came to be discussed at all.

Everyone in this Committee and in the country will have the greatest sympathy with the Dominions Secretary in his present position. He is faced by two opposing principles. He has the scheme of the Minister of Agriculture on the one band, and he has the high Protectionists and Empire Free Traders on the other. The Noble Lord the Member for Horsham (Earl Winterton) criticised the Dominions Secretary in quite a friendly spirit for daring to say that Empire Free Trade was not possible just now, and suggested that, if he thought it was not possible now, he should not say so. But I think that to-day more than at any other time we want to tell the complete truth about what we are prepared to do and what we are not prepared to do, and that both this country and the Dominions will welcome a clarifying of the position. If it is bad, let them know where they are; if it is good, let them know where they are. More than anything else to-day, as far as the Dominions are concerned, we ought to let them know what is possible and what is not possible. I would humbly suggest that both the extreme Free Trader and the extreme Protectionist are quite wrong to-day. Either policy, so far as one can judge, gets one nowhere. I believe the solution of this question to be one of balance and of dovetailing the requirements of the Minister of Agriculture with a scheme of limited Empire Free Trade.

The Dominions Secretary said that he thought the Committee were on a wrong Vote—that they should be criticising or moving to reduce the salary of the President of the Board of Trade or of the Minister of Agriculture. There I think he is wrong, because I think the position of the Dominions Secretary today is to see that he acts between the Minister of Agriculture and the President of the Board of Trade, and keeps the Dominions fully conversant with the wishes and desires and possibilities of this country. For instance, a previous speaker has said what an immense surprise it was for New Zealand to hear that in this country there were employed in agriculture far more people than the whole population of New Zealand. It is high time that they knew that, and I would ask the Under-Secretary to see that propaganda is disseminated in the Dominions stating the real importance of agriculture to this country, and what a vast number of people are concerned in it.

To my hon. Friends opposite I would say that I think it is perfectly logical to ask, when every other form of manufacturing industry in this country is protected, why should agriculture be left out in the cold? Even the right hon. Gentleman the Member for Carnarvon Boroughs (Mr. Lloyd George) has pointed out that some people in this country seemed to think that, because eggs or poultry came from the Dominions, they were easy to compete with in this country. I am sure that Dominion agricultural produce is just as difficult for the British farmer as any foreign produce. If it were possible to get some clearer line which people in this country knew, and which people in the Dominions knew, as to how we were going to dovetail the policy of the Minister of Agriculture with that of more Empire Free Trade, misunderstandings would be less likely to arise.

It seems to me that we are perfectly justified in trying to build up those parts of our agriculture in which we can be self-supporting—eggs, poultry, pigs and such like—and asking the Dominions to realise that for the sake of our own countryside we wish to have some restriction. I need not remind the Dominions Secretary of what happened at Ottawa. As far as can be judged by one who has been in Canada since then, it was a very one-sided bargain, but the Dominions were only doing what they thought was best for their own countries. I do not understand it when I hear Members of this House say that we should not use the Colonies and the Dominions for bargaining. You have to bargain with the Dominions as hard as with anyone else. They are out for their own country, quite naturally. You can have sentiment in business and, when you have made your bargain, if you can give a preference, good and well. That should be clearly understood. If anything can be done in a voluntary manner so much the better.

As a Liberal, I would ask that, if the Government find it necessary, as they may, to restrict some Dominion imports into this country, they should make their restrictions and their tariffs in as temporary a manner as possible, so that we may be able to use them more flexibly and not give our farmers the idea that they are entrenching behind a tariff for ever, and that a Government may come along which will reduce the tariff or take it off. Even a Liberal Government may come back, and it will not necessarily feel bound for ever to keep on these tariffs. That is our objection in some ways to the present tariffs—the permanence that is given to them. A Liberal Government in power to-day would have to retain many tariffs which are on, but I trust that it would put them on in a more temporary fashion, even though the actual effect might be the same. With regard to the question of complete free trade, I should like to draw the attention of the Under-Secretary and my hon. Friends opposite to what is going on in Canada, where the Government just before the Easter Recess produced a Marketing Bill which surprised both Parliaments by its extremely radical nature. It is to provide by Order in Council for the marketing of any product, the control of export and the regulation of import. You have only to see what other countries are doing to see the impossibility of bringing about complete free trade. As far as emigration is concerned, we are told that one of the great difficulties of the Dominions is the want of population. There are plenty of people here who are willing to work but there is no work for them. We are being asked to encourage the import of Dominion produce, which is bound in one way or another to put some of our farming people out of work, and the Dominions are not in their turn willing to allow a single man in, though one can understand the immediate difficulty of the Dominions in regard to their industrial position.

I should like to impress upon the Under-Secretary the need for keeping this question constantly in view. This country is being stifled for lack of emigration. If you take the figures for the past 20 years, you at once grasp how we are being stifled. It is only fair to ask, if they wish to get a larger proportion of their produce into this country, that they should do something in return by way of helping our population, especially the young boys. I should like to hear that the Government will shortly consider the matter. Australia is making herself a danger spot in the world through reserving such a large amount of land for so small a population, and she is only able to do it because she has the power of Britain behind her. She should remember that.

There are various extraneous matters that I should have liked to have taken up. I should have liked to have followed up the solution of the hon. and learned Gentleman the Member for East Bristol (Sir S. Cripps), the question of trade monopoly under Government control as against capitalism. He knows I am going to mention Russia, which is the outstanding example. The position is not very greatly relieved in Russia by a trade monopoly in Government hands instead of capitalism. This country under Socialist, Communist or under any other rule, would meet with the same difficulty as the capitalist system, that is to persuade the foreigner to buy our goods. I hope this Debate will clear the air in the Dominions as to our intentions and our willingness to extend to them the utmost Free Trade that we can, compatible with our own interests. We are being forced, owing to nationalism and exchange restrictions, to adapt our minds to new ideas. Some of the remedies that we have to use are evils in themselves, but they seem to me to be necessary to use in the meantime, if we are to bring our people through these very difficult times.

9.3 p.m.

Duchess of ATHOLL

Before I come to the subject-matter of the Debate, I should like to say that I share the anxiety that has been expressed by the right hon. Gentleman the Member for Newcastle-under-Lyme (Colonel Wedgwood) in regard to the possibility of the transfer of our native territories in South Africa. I regard our administration of the territories of coloured races within the Empire as one of the greatest responsibilities that rest upon the people of this country. I hope the Dominions Office will give the most careful consideration to this very big question and will take every opportunity of learning the real views of the people themselves, because I share the right hon. Gentleman's fears that it may not be very easy to ascertain what those views really are. I hope the Government, therefore, will not be afraid to decide this question on what they ascertain, and know by experience, to be likely to be in the best interests of the people of the territories themselves.

With regard to the situation that has arisen in regard to imports from the Dominions, more especially from Australia and New Zealand, in spite of the reassuring and interesting speech we heard from my hon. Friend the Member for West Derby (Sir John Sandeman Allen), I think it is impossible to deny that we find ourselves in a rather difficult position in this matter, partly because we have been ignoring what I believe to be a rather fundamental factor in the whole question. On the one hand the British agriculturist finds that the imports of butter and cheese from those Dominions have increased in the last few years, and that they are coming in large quantites at low prices, and the Government therefore believe themselves to be driven in the interests of the British agriculturist, on the top of negotiations for the restriction of meat exports to us from those Dominions, to ask also or to consider making a request for restriction of exports from those countries which I believe are fully as valuable if not more valuable to them than their meat exports, namely, their exports of butter and cheese.

It is very important that we in this House, particularly those of us who represent agricultural constituencies, should realise that the fall in the price of butter on this market since 1928 has been so great that even though Australia and New Zealand have doubled their exports of butter to us in that time, the total value they received last year for their exports was slightly less than in 1928 for double the quantity. It is still more important to realise that low though the prices are at which Australian and New Zealand butter is coming to us, butter is being imported at a still much lower price from Soviet Russia. [Laughter.] It is all very well for hon. Members to laugh, but if the right hon. Gentleman opposite would study the Board of Trade returns and take the trouble to do a little arithmetic he would be able to arrive at some very interesting and important figures.

These figures show that the Soviet price-cutting began in 1930 with a drop from a price of 156s. a cwt. in 1929 of butter imported into this country to a price of 121s. a cwt. That was quite a good start. But Soviet price-cutting has continued year after year ever since. It has dragged down the price of all other butter coming from other countries; it is continuing to this day, and it is very interesting to see how butter from Soviet Russia has always kept far below the price of any other butter. Since 1929 Australian butter coming into this country has decreased by 64 per cent., from 185s. per cwt. in 1929 to 65s. a cwt. in the last three months. Butter from New Zealand has decreased by 65 per cent. in that period, from 172s. a cwt. to 60s. a cwt.; butter from Denmark in the same period has declined by 59 per cent., from 179s. to 72s.; but butter from Soviet Russia in the same period has declined by no less than 73 per cent., i.e., from 156s. a cwt. to 41s. a cwt.

That is to say, within the last three months, butter from Soviet Russia has been coming in at an average price of a little over 4d. a lb. It may of course be said that the quantity coming from Soviet Russia is considerably smaller than that coming from the other three countries I have mentioned. That is quite true, though the quantity is the fourth on our import list, but I submit with all earnestness that a small quantity of a commodity coming on to a market at a very low price may easily disorganise prices on that market. Prices seem to me to matter far more than quantity, and I have therefore noticed with anxiety Government utterances tending to throw more emphasis upon quantity than upon prices, as I have been assured by traders that what matters most is price. After all, our farmers and manufacturers need not mind what comes into this country so long as it comes in at a price which would give a reasonable price to them which would cover their cost of production and give them a fair profit. We need not mind imports in those circumstances. It is when prices of imports fall utterly below a price which is a profitable one or which even fails to meet the cost of production in this country that imports become so very detrimental in character. In any case, it should be realised that the quantity of butter imported from Soviet Russia has risen from 336,000 cwts. in 1928 to 562,000 cwts. last year.

The CHAIRMAN

The Noble Lady is quite in order in quoting particulars of exports or of imports into this country from other countries, in order to compare them with those from the Dominions, but she must bear in mind that the Soviet does not come under the Minister.

Duchess of ATHOLL

I could never believe in my wildest dreams that Soviet Russia could be part of the British Empire. But I venture to say that as the Minister of Agriculture has said that the root causes of the very serious troubles with which the milk industry at present is faced in this country are the low prices of butter and cheese, I am entitled to take what steps I can to try to arrive at a reason for that very low price of butter; and I submit to you that the figures which I have given show that Russian butter must have been a large factor in the catastrophic fall in the price of this commodity. And there need be no end to it, as we know that everything produced in Russia is produced in absolutely abnormal conditions, including what the hon. and learned Member for East Bristol (Sir S. Cripps) has been lauding to us, a Government monopoly of foreign trade.

If, then, it is the case that this very low price of butter is at the root of all our milk troubles, and if, as I believe, it is also the case that Russian prices are largely responsible for this great fall in prices, then they are also the cause of very great loss not only to the British producers, but to the producers of the Dominions of Australia and New Zealand. We have further to remember that Australia has already suffered from the competition of Russian wheat on our markets. That was established by the Imperial Economic Committee Report some two or three years ago.

But it may be said that Australia and New Zealand also export to us large quantities of cheese and that no cheese comes to us from Soviet Russia. I think it is recognised that the prices of butter and cheese hang together. If milk sold for butter commands a very low price because of the low price of butter, it equally follows that the low price of that milk sold for manufacture will affect the price of cheese. As a matter of fact a very experienced dairyman the other day assured me that they hung together, and that it was butter which controlled the price of cheese, because the consumption of butter was so much larger. In any case the fall in the price of Dominion cheese, though it was, I think, referred to here the other day, has not been so great as the fall in the price of butter. Australian cheese between 1929 and 1934 did not fall more than 52 per cent., from 89s. a cwt. to 41s. a cwt.; New Zealand cheese did not fall more than 53 per cent. in the same time; and Canadian cheese did not fall more than 39 per cent. It seems clear, therefore, that it is the fall in the price of butter which is much the biggest factor.

In the circumstances it may be necessary to ask the Governments of those Dominions to restrict their exports of butter and cheese, but I submit that we owe it to the Dominion producers as well as to our own to do what we can to end this devastating and wholly abnormal competition; and if by ending that competition we can raise the price of butter it should be possible to take off restrictions on Dominion dairy imports at an early date. It is also worth while to remember that the dairy exports of Australia and New Zealand are of very great value to them—value fully as great as that of their exports to us of meat. It may, therefore, well be that if by taking action to stop Soviet butter coming in at abnormal prices we improve the price of butter and cheese here, it will be easier for the Governments of those Dominions to meet us over the restriction of their meat exports to us, which is a very important matter to the British livestock farmer.

But dairy exports are not the only respect in which the Dominion producers have suffered, and are suffering to-day, from competition from that same country. Canada and Australia are suffering from the very low price of wheat on our market, and Russian wheat is quoted below all others. The same holds good in regard to barley, oats and timber. All these imports affect Canada, and I think the Canadian Government may be regarded as having acted in a very conciliatory manner when we remember that in spite of the clause in the Ottawa Agreement which obliged our Government to stop any State-aided dumping which was likely to destroy the value of any preference given to Canada, the Canadian Government was satisfied with a recent restriction of Russian timber imports of not more than 12½ per cent.

I bring up this matter now because in the agreement recently concluded with Soviet Russia we have machinery for dealing with imports of this kind. Article 2 of that agreement gives our Government power to prohibit or restrict the import of any commodities from that country that can be shown to be destroying the value of a preference given to any part of the Empire, or to be detrimentally affecting the production of a similar commodity in this country. I have said here before, and I say again, that I am disappointed that the machinery in that article does not allow of more prompt action, but such as it is it is intended to deal with dumping of an injurious character, and as such I am strongly of opinion that it ought to be tried and tested to see what it is worth. Therefore, I beg the Secretary of State for the Dominions, and I also beg the President of the Board of Trade and the Parliamentary Secretary, to give most serious consideration to this question, because it seems to me to lie at the root of two big questions.

The figures which I have quoted, and which I will gladly make available to the right hon. Gentleman, incontestably prove that Russian butter is a very important factor in the catastrophic fall in the price of butter which is a big factor in the depressed condition of our dairying industry. Russian imports are also largely responsible for the very heavy loss which has been incurred by Australia, New Zealand and other Dominions in respect of butter and other commodities. We owe it therefore both to our own producers and to Dominion producers to lose no time in making use of the machinery which we now have to our hands to deal with imports which cause such grievous loss and seem to be likely to prejudice, in fact they have already prejudiced to a considerable degree, the good results that we had hoped to obtain from the Ottawa Agreements.

Mr. J. H. THOMAS

Is it the complaint of the Noble Lady that Russian butter is sold cheaper in Russia than hers? is that the point?

Duchess of ATHOLL

No, I am not concerned at the moment with the price at which butter is sold in Russia. The right hon. Gentleman must know that owing to the conditions there the price of butter in Russia is infinitely' higher than here. The latest price that I have heard quoted was about 60s. a pound. I have been telling the Committee that Russian butter has been coming into this country in the last three months at an average price of a little over 4d. a pound, and that that is a great factor in the terrible and continuous depression in the dairying industry.

Mr. THOMAS

If, for instance, Australia or New Zealand sell to their own people butter at a higher price than here, would that be a cause of complaint?

Duchess of ATHOLL

My belief is that if assistance is being given by the Governments of Australia and New Zealand or by any organisation in those Dominions to the exporters of butter, they may have been induced to do that by the fact that prices here as so low.

9.22 p.m.

Major MILNER

The Noble Lady will forgive me if I do not follow the line she has taken. I desire to refer to the very important question which has been raised by the hon. Member for Orkney and Shetland (Sir R. Hamilton) and the right hon. and gallant Member for Newcastle-under-Lyme (Colonel Wedgwood). I wish to deal particularly with what, in my view, is the very serious constitutional aspect which arises in connection with the possible transfer of certain native territories to the Government of the Union of South Africa. I hold in my hand certain Bills which have already had a Second Reading before the Parliament of the Union of South Africa. One of the Bills provides for certain Amendments of the South Africa Act, 1909, and another Bill purports to re-enact the South Africa Act, 1909, but omits to re-enact a very important Section of that Act dealing with the matter now under discussion. That Section of the South Africa Act, 1909, Section 151, which has been omitted from the Bill which purports to re-enact that Act, raises a very serious matter which will require all the ingenuity of the right hon. Gentleman to deal with it, in certain contingencies which may possibly arise. That Section reads as follows : Power to Transfer to Union Government of Native Territories. The King, with the advice of the Privy Council, may, on addresses from the Houses of Parliament of the Union, transfer to the Union the Government of any territories, other than the territories administered by the British South Africa Company, belonging to or under the protection of His Majesty, and inhabited wholly or in part by natives, and upon such transfer the Governor-General-in-Council may undertake the government of such territory upon the terms and conditions embodied in the Schedule to this Act. That Section is not, apparently, being re-enacted, but in a Bill which is before the South African Parliament called Royal Executive Functions and Seals Bill, Section 7 is in these terms : In the absence of any Act of the Parliament of the Union providing otherwise, the powers of the King to be exercised by His Majesty in Council or by Order-in-Council, under Acts of the Parliament of the United Kingdom passed prior to the commencement of the Statute of Westminster, 1931,"— of course, the Clause which I have read to the House was so enacted— and extending to the Union as part of the law of the Union shall, in respect of the Union, after the commencement of this Act, be exercised respectively by the Governor-General-in-Council or by him by Proclamation in the Gazette "— So that the first portion of the Clause in the Bill now before the South African Parliament provides that powers which, under the South Africa Act, 1909, can only be exercised by the King-in-Council may in future, if this Bill passes the South African Parliament, be exercised by the Governor-General-in-Council in South Africa. It therefore substitutes for the power which has been exercised by the King-in-Council a decision of the Governor-General-in-Council in South Africa.

The Clause continues— unless the Governor-General-in-Council decide that the exigencies of the case require that the procedure prescribed by such Acts "—

those are Acts passed before the Statute of Westminster, 1931— be followed : Provided that the King-in-Council shall in the latter case "—

that is, a case which under the Statute of Westminster would be submitted if the South African Government decide—I would point out to the House that the South African Government are to be the judges in their own case—that it is to be submitted to the King-in-Council may be so submitted, but the King-in-Council shall in the latter case act or purport to act in respect of the Union only at the request of the Prime Minister of the Union duly conveyed and it be expressly declared in the instrument containing the King's pleasure that the Union has requested and consented to the King-in-Council so acting in respect of the Union.

I submit that that means that, if this Bill passes the South African Parliament, it will be within the power of the South African Government, through the Governor-General in Council, to act in. lieu of the King and Council and to transfer to the native territories—

The CHAIRMAN

I understand now—I had not realised it before—that the hon. and gallant Gentleman is discussing, not an Act of the South African Parliament, but a Bill which is before the South African Parliament. He cannot discuss that here.

Major MILNER

With respect, I am proposing to ask the spokesmen of the Government what action they intend to take, and to ask them to make representations on this very important matter.

The CHAIRMAN

What action they intend to take in the hypothetical event of a certain Bill being passed, and thereby, I gather, to criticise or make reference to the action which they intend to take.

Major MILNER

With respect, up to the point which I have reached in dealing with the matter so far, these are accomplished facts. They are matters which have taken place in legislation which has come before the Parliament of the Union of South Africa and has passed its Second Reading. I am now desirous of asking, and am asking, the spokesmen of the Government what they intend to do, and I am doing so principally in order to avert, or to assist this or future Governments in avoiding, an obvious source of friction.

The CHAIRMAN

The hon. and gallant Member has admitted that this is legislation which has not yet been passed. He cannot discuss in this House legislation which it is intended shall be passed through a Dominion Government.

Major MILNER

With respect, I am primarily putting before the House certain considerations in relation to these particular Native Territories and their transfer, and I am calling the attention of the Committee, and of the right hon. Gentleman the Secretary of State for Dominion Affairs in particular, to certain accomplished facts in relation thereto. I submit respectfully that I am entitled to do that.

The CHAIRMAN

The whole of my point is that it is not an accomplished fact. The Second Reading of a Parliamentary Bill may be an accomplished fact in so far as it is legislation which is pending, but it is not completed legislation and so far as it is legislation which is pending in the Union Parliament, we cannot discuss it here.

Sir S. CRIPPS

On that point of Order. I submit that if there were an Act of another Dominion Parliament which might react upon the power of this House in a matter of this kind, it is important to know whether we have to wait until the opportunity of taking any steps has gone, owing to that Act having been passed. May we not try to anticipate the difficulty by drawing the attention of the Dominions Office to the difficulty that will arise, if that Act should become law, between the Union of South Africa and this country?

The CHAIRMAN

The hon. and learned Gentleman has put a hypothetical case which is not exactly the case upon which I have ruled at the moment. I therefore propose to confine my Ruling to the hon. and gallant Gentleman's speech.

Sir H. SAMUEL

On the point of the principle, if the pending legislation of the Dominions clearly affects, not merely domestic matters, but also matters which are within the competence of this House, is not this House entitled to take cognisance of the matter before it becomes a fait accompli?

The CHAIRMAN

I think I shall have to hear a strong case made out for that purpose, and I cannot say that it has yet been shown.

Mr. J. H. THOMAS

On the same point of Order, with a view to reassuring the House : had the question of Protectorates been raised to-day, I should have told the House that the Government's position was exactly as announced by me last week, but I am assured on the legal point raised by the hon. and learned Gentleman that, no matter what may happen, the position of this country, so far as its declaration and policy affecting the Protectorates are concerned, has undergone no change whatever.

Major MILNER

I am obliged to the right hon. Gentleman for reassuring the Committee. I was saying quite frankly that, reading the Bills——

The CHAIRMAN

It is pretty clear that this country, in regard to any rights or powers it may have over its own Protectorates, acts according to its own Acts of Parliament, and not according to any Acts of Parliament which are passed by any foreign country or any Dominion. I must therefore ask the hon. and gallant Gentleman not to discuss further the Bill which is before the South African Parliament.

9.33 p.m.

Sir S. CRIPPS

On that point, this is an extremely important matter in view of the Statute of Westminster. Under the Statute of Westminster a Dominion Parliament has power to alter the provisions of an Act of this House that applies to the Dominion. It is a matter of vital importance to this House how far those alterations may go and, where—as in a case such as this—you have an Act which applies to a Dominion and the surrounding territory, how far the Dominion can alter the Act of this Parliament with regard to the surrounding territory. That is the vital point which was raised over this legislation. In those circumstances, Sir Dennis, I submit to you that if that Dominion is purporting to pass Acts of Parliament which may affect, or may be claimed to affect under the Statute of Westminster, the surrounding territories as well as the Dominion itself, that is at least a matter which it is vital that we should discuss in this House before the legislation has been completed in the Dominion, when it can only raise very acute controversy, which might be avoided by discussion at this stage.

The CHAIRMAN

I am not prepared to say definitely, and I do not think I am called upon to rule at the present moment, what may be the position of this House in the event which the hon. and learned Member is contemplating, of a Dominion Parliament proposing under the powers of the Statute of Westminster to pass something which would alter an Act of Parliament of this House. I do not think that has arisen in the course of this Debate and, therefore, it is sufficient to say that I adhere to my Ruling, that we cannot discuss the Bill to which the hon. and gallant Member has referred.

Sir S. CRIPPS

I am sorry to be persistent, but the introduction of the Statute of Westminster has perhaps altered the question of procedure and makes the position more difficult. Clause 7 of the Bill which the hon. and gallant Member for South East Leeds (Major Milner) has read, does, in terms, purport to alter Acts of Parliament of this House. It says : In the absence of any Act of Parliament of the Union providing otherwise, the powers of the King to he exercised by His Majesty in Council or by Order in Council, under Acts, of the Parliament of the United Kingdom passed prior to the commencement of the Statute of Westminster…. shall be exercised by the Governor-General in Council. This Bill, therefore, is purporting to alter all Acts relating to South Africa prior to the Statute of Westminster. In every case where in these Acts of Parliament the King acts in Council, the Bill is purporting to replace the King in Council by the Governor-General in Council, and that covers not only the Union itself but the adjoining territories to the Union. In my submission, it is of vital importance that we should be able to discuss whether this Bill will in future make it impossible for the King to act in Council, his powers having been, under the Statute of Westminster and by this Bill, transferred to the Governor-General in Council.

The CHAIRMAN

I desire to protect myself, as far as any Ruling I may give now, as much as possible against extending it beyond the circumstances which I have under consideration at the moment. The hon. and learned Member for Bristol East (Sir S. Cripps) has referred to the Statute of Westminster, which he says has altered the position. It has altered the position in exactly the direction in which I have been Ruling, in that it has amplified the powers of Dominion Parliaments to act independently, and there is the more reason, therefore, against our discussing legislation pending in these Parliaments than there was before the Statute of Westminster was passed. The hon. and learned Member raises certain suppositions as to what may happen in the future. My own view at the moment is that I must rule against anything being discussed which may arise if such suppositions materialise, on the ground that we are not entitled to discuss them here until they become accomplished facts. In other words, we are not entitled to discuss a Bill which is before a Dominion Parliament, although it may be the case that certain Bills before these Parliaments, when they have been passed and have become Acts of Parliament, may be a proper subject for discussion. But that question does not arise at the moment.

Sir S. CRIPPS

Is it impossible for us on any occasion in this Committee or in this House, when we foresee a danger if such a Bill is passed of it creating serious friction between the Dominions and this country, to raise the matter in this House?

The CHAIRMAN

I am not concerned to give a general Ruling of that kind. It is a matter which is much better considered and ruled upon, if and when necessary, after full consideration, and as there is no immediate occasion for me to give a general Ruling, I do not propose to do so.

Sir P. HARRIS

Have we not on many occasions discussed legislation passed by the Irish Free State Parliament when it has interfered with the executive powers of the Imperial Parliament?

The CHAIRMAN

I do not know whether the hon. Member was here at the beginning; if so, he appears to have missed the point entirely.

9.41 p.m.

Major MILNER

I understand your Ruling to be that I do not deal with the Bills which are now before the South African Parliament. I will therefore deal with the policy of His Majesty's Government in relation to native territories. I would remind the Secretary of State that when the South African Act, 1909, was passed it was expected, and presumably intended, that the Union would remain an integral part of the Empire, and in Section 151 certain provisions were made dealing with the right of the King in Council to transfer authority over these territories. I desire to ask the Secretary of State whether it is possible to get an assurance that in all and every circumstance His Majesty's Government will see that no territories are transferred by the authority of any other Government but the Government of the United Kingdom, and after full discussion by the Parliament of this country, and, secondly, whether in the event of any such case arising it is the policy of His Majesty's Government to see that the natives are consulted.

Mr. THOMAS

I give that assurance now. I unhesitatingly say, on behalf of the Government, that every promise, including the promise that this House shall be consulted and shall agree, will be carried out. I give that assurance without qualification, and incidentally may I say that nothing arising out of any legislation of any sort or kind precludes His Majesty's Government giving effect to that pledge.

Major MILNER

Will the Secretary of State be good enough to have the legal questions I have put before the Committee reconsidered, and if he is advised that it is desirable will he make representations to the proper quarters so that danger may be avoided.

Mr. THOMAS

As to the legal questions, my duty is to get the best legal advice available, and the legal advice available to me from the Law Officers of the Crown is that there is no ground for the apprehensions expressed by the hon. and gallant Member. If there is any doubt there is no question as to what our attitude would be.

Sir S. CRIPPS

Does the Dominion of South Africa accept that view entirely?

Mr. THOMAS

I think I can go as far as to say that. The interpretation indicated by the hon. and gallant Member for South East Leeds (Major Milner) is not accepted by anybody that I know. I am advised that it is a legal, technical question, and has to do with the position of the Governor-General acting for the King, who may be unable to sign owing to exceptional circumstances. They are legal matters, and I am assured that the legal view which has been expressed is not accepted by all legal authorities

Major MILNER

Will the Secretary of State be so good as to resubmit the question to his legal advisers and also get a statement from the Government of South Africa and submit it to the House, so that we may be sure that the views of His Majesty's Government and the South African Government are in accord on this matter? I ask him to give the Committee this assurance.

9.44 p.m.

Mr. LENNOX-BOYD

The hon. and gallant Member for South-East Leeds (Major Milner) will forgive me if I do not follow him in the very interesting constitutional questions he has raised. If I make one reference to the question of South Africa, I would say with what entire agreement I listened to the speech of the right hon. and gallant Member for Newcastle-under-Lyme (Colonel Wedgwood). It is not the first time that the right hon. and gallant Gentleman has come to the aid of those who live in native territories, in Africa and elsewhere, and I think the right hon. Gentleman more adequately represents the point of view of the mass of the people in this country in regard to what trusteeship involves than those, many of whom are found in the Conservative party, who believe the duty of trusteeship is over when you have presented the natives with a ready-made constitution modelled on Western lines.

I would like to make a brief reference to the question discussed earlier in the evening, in regard to the correspondence between His Majesty's Government and the Dominion of New Zealand. This correspondence between the two Governments and the disastrously low prices prevailing for butter, milk and dairy produce in this country, are being used by certain unscrupulous people in rural districts to embitter the home farmer against his Dominion colleagues, and to suggest to him that the prosperity of British farming and the development of Imperial agriculture cannot be reconciled. I do wish that those Members of His Majesty's Government who quite properly emphasise the competitive side of Dominion agriculture would be as vigorous, or even more so, in showing how comparatively easily the two forms of agricultural endeavour can be made complementary. I have heard Ministers of the Crown in rural districts assuring the farming population that it does not much matter who ruins them if they are ruined, and the average farmer goes away convinced that in the Dominion agriculturist he has probably met his most dangerous competitor. I am one of those who believe that this form of propaganda is quite disastrous, that we are in this world drifting towards great economic groups, and that our future vitally depends on the British economic group being firmly and properly established, and if this sort of bitterness is allowed to prevail the Heaven-sent opportunity of a National Government with a large majority will have gone perhaps for ever.

The Noble Earl the Member for Horsham (Earl Winterton), in his interesting and vigorous speech, reproved the Dominions Secretary quite properly, I think, for the contemptuous way in which he dismissed the ideal of Empire Free Trade. He pointed out that 25 years ago the Ottawa Agreements themselves would have seemed to the Parliaments of that time fantastic and impossible. I am inclined to agree with him that there may come a time within the lifetime of many in this House when some form of Empire Free Trade may become practical politics. I hope it will not be those who have vigorously condemned it who will implement it when the time comes. There is something to be said for Free Trade being put into practice by those who believe in it, and something for Protection being put into effect by those who have supported it, but nothing to be said for Imperial Preference being put into effect by those who do not believe in it and whose whole political life has been spent in vigorous opposition to it.

On this subject of Imperial rationalisation I think the imports of dairy produce from New Zealand and Australia provide a very great opportunity for discussing among ourselves, in some form of Imperial Committee such as Mr. Bruce suggested, the question of the self-sufficiency of the Empire from the dairy produce point of view. We are nearly self-supporting already. Last year, of 183/4 millions, 8,000,000 came from Australia, New Zealand and other parts of the Commonwealth, and the Dominions Secretary, when he quoted the high proportion of New Zealand exports to this country, unconsciously put forward one of the best possible examples to prove the value of the New Zealand offer.

I would like to put before the Committee certain figures. We have had a series of figures from a variety of speakers, and I think, though I do not suggest the Committee has been intentionally misguided, that it does not quite realise that in the first three months of this year the proportion of imports of dairy produce into this country from foreign countries has increased most significantly. Take the six months ended February, 1934, and compare them with the six months ended February, 1933, and you will see that the imports of butter from the British Commonwealth have gone up 69,000 cwts., but butter from foreign countries has gone up 160,000 cwts. That represents the net increase, but if you examine certain specific imports the figures are more significant. From Russia—which I must apologise for mentioning again—the imports have increased by 95,000 cwts., from Estonia 14,000, and from Sweden 60,000. Those people who think they are helping home agriculture and Imperial trade by telling the British farmer that it is New Zealand butter that is ruining him should, in fairness to the Committee and to the country, publish figures of that kind.

As to eggs, we are supposed to represent here divisions in which hundreds of thousands of smallholders are endeavouring to make a living. In the first three months of this year imports from British countries declined by 27 per cent., a total value of £142,000, while imports from foreign countries have only declined 2 per cent., a total value of £33,000. On the question of cheese, which very properly ranks in the forefront of the discussion, everybody must recognise that New Zealand imports have a preponderating influence in fixing the price. But we should bear in mind that the milk products that we have from New Zealand and Australia are chiefly butter and cheese, which do not compete with the very considerable imports of tinned milk products.

It is the policy of the Government, judging by the published statement of many Ministers, to undervalue altogether the effect of tinned milk products on the price at home, and I think we should examine what has been happening in the last six months. Taking separated or skimmed milk, the imports from British countries, including New Zealand and Australia, have been 31,000 cwts., while imports from foreign countries have been nearly 800,000 cwts. In the first three months of this year, tinned milk unsweetened, from the Dominions showed a decline from £68,000 to £20,000, and those from foreign countries from £91,000 to £83,000. If you take finally separated or skimmed milk, this year there has been an increase from foreign countries of £56,000 and a decrease of £6,000 from the Empire.

I entirely accept the statement of the right hon. Gentleman that there is very little bitterness in New Zealand. He says that the High Commissioner never entered a public protest at the Dominions Office, but that does not alter the fact that in failing to accept more gracefully the offer made by the New Zealand Government, the National Government in the United Kingdom may have missed a heaven-sent opportunity. After all, there is a preponderating series of reasons why we should give New Zealand a warmer and more enthusiastic welcome than any other country that comes to us. She gave us a preference in 1903, many years before other countries did and before we returned the compliment, and as a result our trade grew by two-thirds in the 10 years before the War. In the War she sent one in four of her entire population to support the Allied cause, and since the War, judging by the most recent figures, she is buying £13 a head for every person in the Dominion. When we consider that the highest among foreign countries is the Argentine with under £3 a head, we are entitled to say that New Zealand is, in many ways, our best market. I hope that the Under-Secretary will give us an assurance that the enthusiasm of the British farmer for the dual policy of home development and Empire collaboration shall be encouraged by the Government and not diminished by speeches which ignore the effect of foreign imports on the British and Dominions market.

9.56 p.m.

Dr. McLEAN

The right hon. Gentleman the Member for Darwen (Sir H. Samuel) raised some fundamental economic questions which are worthy of further attention. He criticised the Government for what he called its economic nationalism. Much depends upon what we mean by "economic nationalism." These words often mean different things to different people. If economic nationalism means that we wish to create a self-contained economic unit, possibly it is a bad thing, but if it means national economic planning as a basis of trade and other developments, obviously it is a good thing and this is what the Government are doing, and I think they are to be congratulated upon doing it. To give the House a practical example of what I would call good economic nationalism I take the case of Egypt. I use it as an analogy. The life of that country depends upon the water of the Nile, which used to flow largely wasted through the desert into the sea. Artificial barriers were built across the river, quotas were adopted for the distribution of the water and for the growing of crops both for the home market and for export which resulted in a balanced trade. This, along with a planned national development, a work in which I had personal experience, resulted in prosperity for that country. In this country we have analagous artificial barriers in the form of tariffs and quotas, and these are helping to restore our trade balance and are making possible a planned national development. I submit that if we examine the economic policy and legislation of the Government, as a whole, we shall find that a definite approach has been made towards a national development plan for the United Kingdom which will co-ordinate the development of trade, transport, land and public services.

The right hon. Gentleman the Member for Darwen raised the question of increasing consumption. We all recognise that it is a fundamental problem, but the only practicable method of increasing production is to relate production to markets, and that is what the Government are trying to do. In that way prices are maintained and purchasing power and consumption are increased. Incidentally one may remark that these efforts of the Government will help in preparing the programme of works of national development, so ardently desired by our friends opposite—in fact it seems to be one of the principal planks of their platform. I should like to point out that the efforts of the Government represent the only means of ascertaining if, and when, such public works are economic undertakings. The right hon. Gentleman's policy, if not based upon the methods which are being used by the Government, would end not in national development but in national disaster. A programme of uneconomic public works, if carried far enough, could end only in disaster.

The Government having arranged to put our own house in order, it becomes possible on the basis of what is being done to meet the Dominions and to arrange complementary lines of trade. The Dominions having industrialised themselves, this appears to be the only method of approach to the matter. Until they have settled their own domestic problems they are not in a position to meet us. We hope they will soon be able to do so, but it is hardly fair to blame the Government for the delay. Trade agreements ought to be much more easily made with our own people than with foreign countries, but it must also be recognised that we have to continue, as far as possible, to make trade agreements with other countries so as to extend world trade which is so desirable. I therefore submit that there is neither substance nor economic truth in the criticisms of the Government which have been made on the grounds of undesirable economic nationalism and lack of Empire cooperation.

10.2 p.m.

Mr. HOLDSWORTH

Every Member of the Committee will agree with me that we have had a very interesting Debate. It has been particularly interesting to hear the different reasons advanced as to why agriculture in this country is in its present difficult position. The Noble Lady the Member for Perth and Kinross (Duchess of Atholl) said that she did not mind imports, provided that they were dear enough. She had no objection, apparently, to imports as such. Her only objection was against the consumer in this country getting them cheaply. Then the Noble Lady returns to her favourite theme of Russia. It was once said that Queen Mary had "Calais" written on her heart. I think it could be said of the Noble Lady that she has the word "Russia" written on her bonnet. Whatever subject we are discussing in this House she introduces Russia. We have now had 18 months in which to see the effect of the Ottawa Agreements not only on Empire trade but on our own internal trade. We on these benches denounced the Ottawa Agreements when they were submitted to the House. We were criticised on every hand for doing so. Every form of denunciation was used. Every epithet was hurled at our heads, every gibe and sneer that could be thought of was extended to my right hon. Friend the Member for Darwen (Sir H. Samuel) and his colleagues who resigned from the Government.

I wonder if those who expressed enthusiasm for the Ottawa Agreements are as enthusiastic now. Ottawa is a word that is heard in whispers to-day and not shouted from the house-tops. [HON. MEMBERS : "Not in Bradford!"] I am coming to Bradford in a few minutes. But I do not think that as many superlative adjectives would be used to-day regarding the Ottawa Agreements as were used 18 months ago. I think there would be some acknowledgment, if Members were bold enough to say so, that the criticisms of my right hon. Friend had been justified by experience. I took care during the week-end to read through a great deal of the Debates which took place 18 months ago, and I want to draw the Committee's attention to certain words used by the Chancellor of the Exchequer in those Debates. He said : I am confident that what was begun there will in future bring perhaps even greater benefits to agriculture in this Country than it does to our industrial community."—[OFFICIAL REPORT, 18th October, 1932; cols. 33–34, Vol. 269.] I wonder if that confidence still remains? Is it shared by the Minister of Agriculture? Is it shared by those Members in this House who represent agricultural constituencies? I remember seeing on the Order Paper last week question after question put down as to the increase in imports, not from foreign countries, but from our Empire countries. For some 15 months the Minister of Agriculture has been using all the energy and ability which he possesses to bring about organised scarcity. His efforts were stillborn by the very existence of these Ottawa Agreements. In so far as the Ottawa Agreements have succeeded in giving the Dominions a greater share of Great Britain's demands for agricultural produce, just so far have they prevented the fruition of the plans of the Minister of Agriculture. Under the Ottawa Agreements we gave free entry for a period of three years as regards eggs, poultry, butter, cheese, and other milk products. The Minister of Agriculture spent sleepless nights thinking out every form of restrictive quota for foreign agricultural produce, and further sleepless nights devising subsidies for surplus milk produced in this country, at the same time encouraging marketing schemes to make the milk too dear for the people to consume; and in the midst of all that expenditure of time and thought greater supplies are coming from the Dominions.

I have not the time to go completely into the figures but they are very interesting indeed. Take the question of frozen beef. Australia and New Zealand in 1932 sent us 1,535,000 cwts., and in 1933 they sent us 1,871,000 cwts., an increase of more than 20 per cent. How is that affecting the farming industry in this country? With regard to bacon, Denmark's imports into this country have been reduced from 1932 to 1933 by 2,145,852 cwts., and at the same time Canada has increased her imports by 320,000 cwts.; and what would have happened if Article 6 of the Canadian Agreement had been carried out, I do not know. In Article 6 of that agreement provision was made for Canada to send into this country 2,500,000 cwts. of bacon. One could go through different items with regard to agricultural produce, but the time is short. May I just refer to a subject which has been referred to often to-day, namely, butter? New Zealand sent us, in 1932, 2,140,000 cwts. of butter and in 1933 more than 2,500,000 cwts. Under the Ottawa Agreement we placed a duty on foreign butter of 15s. per cwt., but we have allowed an increase from New Zealand of butter which is subsidised by the New Zealand Government, a thing which is hindering agriculture in this country.

The same thing applies to cheese. Here again there was an increase of 300,000 cwts. in the year 1933 over 1932 from New Zealand. Again, under the Ottawa Agreements we gave New Zealand and the Dominions the advantage of a 15 per cent. ad valorem duty placed on all foreign cheese coming into this country. Reference has been made to eggs, and the same increase applies there. I am not so certain that the agricultural Members of this House will confirm what the Chancellor of the Exchequer said when he used those words : I am confident that what was begun there will in the future bring perhaps even greater benefits to agriculture in this country than it does to our industrial community. When I was reading through those Debates, I was interested to see a warning which the Chancellor of the Exchequer gave to my right hon. Friend the Member for Darwen, that it was very dangerous to make a prophecy and that the most awful thing that could happen to a man was that a prophecy which he had made should turn out to be false. The prophecy which the Chancellor of the Exchequer made in those words which I have read to the House has proved to be entirely false. There was some disagreement in the House when I suggested that the agricultural Members were not so satisfied with Ottawa now that they have had 18 months' experience of it, but I think it is no secret that the Minister of Agriculture desires as soon as possible to be rid of the undertakings that we made at Ottawa to admit freely the produce of the Empire. I am not arguing which policy is right, but I say, Let the Government make up their minds which of the two policies they are going to follow. They cannot follow both.

I want to refer to the speech of the right hon. Gentleman this afternoon when he gave the House certain percentages. Percentages are very misleading things. What we want to know is, What has resulted from the Ottawa Agreements? If hon. Members would take the care to turn up the Trade and Navigation Returns for January of this year, in Sections 10 and 11, they would find that imports from the Empire went up £1,300,000, while exports went down £2,000,000, and re-exports went down by £1,000,000. In the Debate in October, 1932, I made some very strong criticisms of the Agreements as they affect the woollen and worsted textile industry. This industry has had a great sense of injustice since the increase of duties in Canada in 1930. The rates then imposed brought about a tremendous diminution in the exports of woollen and worsted tissues. In 1929—and I am not quoting this year because, as we were told, it was a boom year; I am quoting it because it was the year previous to the raising of these particular duties—we exported to Canada 23,500,000 square yards of woollen and worsted tissues. The figure for 1932, that is, before the Ottawa duties came into being, was 8,944,000 square yards; or, between these years, a fall of 60 per cent. in the export of woollen and worsted tissues to Canada. In the Ottawa Agreements some of the duties were lowered, but all of them remained higher than they were in 1930. In 1933—I want to be quite fair—there was an increase in the export of these tissues of 734,000 square yards, bringing the total to 9,678,000 square yards. What is this as compared with 1929 before the duties were increased? Less than half.

Mr. HOWARD

That applies to all the world.

Mr. HOLDSWORTH

It does not apply to all the world. In 1913, the year prior to the War—I cite this to show how our trade with the Dominions has decreased—we sent Canada 24,329,000 linear yards. Any one who knows about woollen and worsted textiles knows that I am very conservative if I add one-third to that figure to arrive at the number of square yards, and that makes only a 48-inch width in the cloth. The total was thus 32,500,000 square yards. The Chancellor of the Exchequer in the Debate to which I have referred, used these words, speaking of Canada and Australia : The policy which they have pursued in the past has been one of very high protection, and in giving that protection to their industries they have protected them not only against foreign competition but also against the competition of the manufacturers of this country. It will be found that in our Agreements with them they have given up the idea that their home markets are to be reserved entirely to the home manufacturer, and they have adopted three fresh principles which are of the utmost importance to this country. I will read those principles to see how far they have been carried out in the past 18 months : First of all, they undertake that they will not in future protect uneconomic industries.… Secondly, that they will so adjust their existing tariffs and so frame any new ones that in articles which they desire to make themselves the British manufacturers shall have a fair competitive chance with the Dominion manufacturer; and, thirdly, that the decision, or rather that the investigation as to how that principle is to be applied shall be taken entirely out of politics, party or otherwise, and shall be entrusted to something in the nature of an impartial tariff commission."—[OFFICIAL, REPORT, 18th October, 1932; col. 33–4, Vol. 269.] The Chancellor went on to say that the appointment of that impartial tariff commission would in itself justify the Ottawa Agreement. He finished by asking Members of the House not to impute bad faith to the Dominions. Let us examine how far the Chancellor is justified in his claims. There has been no enormous increase of trade. After a great deal of delay question after question was put to the Dominions Secretary with regard to the setting up of the Tariff Board. Finally, it was set up, and the Wool Textile Delegation was the first to be heard by that board, and the only one to be heard so far in 18 months. The preliminary negotiations were begun in July of last year. The case was fully heard in September, taking three weeks to present. I want to say, what I believe to be perfectly true, that the delegation had a perfectly fair hearing. I believe there is not the slightest doubt of the complete impartiality of the chairman. But as yet there has been no published report as to what action the Canadian Government propose to take on the re-commendations of the Tariff Board. There has been a tremendous delay, a delay of nine months, in implementing whatever decision has been come to by that Tariff Board. One cannot help thinking of the difierence between the weekly output of the Import Duties Advisory Committee in this country and the nine months' delay of the Tariff Commission in Canada. The only public notice of any kind that I have seen I saw in the "Morning Post" on Saturday : The interim report of the Tariff Board on the British woollen textile case, presented last summer, which was mentioned in the Finance Minister's Budget in the House of Commons, is expected to be completed early next week, and to be the subject of tariff legislation this Session. An important feature of this case is that the extent to which Canada makes concessions to this British industry will certainly determine whether or not other important British applicants will continue their efforts before the Tariff Board. I want to say to the Dominions Secretary that it is no use asking us not to impute bad faith to the Dominions if we are to wait nine months for a decision to be made on the one and only application that has been heard before the Tariff Board. It is a well-known fact that other delegations are waiting to see what happens to the wool textile application. It is perfectly true to say that they feel it is no use presenting their case unless the decision is to be implemented by the Government of Canada. I suggest that it is the duty of our Government not only to see that we carry out our pledges, once we have given our word, but also to see that the Dominions carry out theirs. Those Agreements were signed for five years. If it takes nine months to hear every application coming before the Tariff Board there will be six applications heard during the duration of those Agreements.

Now I want to deal with the question of Australia again in reference to woollen and worsted tissues. I am given to understand that Australia has intimated that she is willing to consider a similar investigation into the duties on wool textiles—I would like the Dominions Secretary to listen carefully and correct me if I am wrong—if we will concede the principle, in the first place, of a bias in favour of established branches of the industry now at work. Why should we accept that? Anything that is biased is weighted on one side. I ask that we should be treated by Australia in the same generous way as we treated Australia in the Ottawa Agreements, signed 18 months ago. If the spirit of bias is to prevail, the Agreements must be. I will give the Committee the figures of the exports to Australia of woollen and worsted tissues. In 1929—which is the same year as I mentioned in the case of Canada—we sent more than 7,000,000 square yards to Australia. In 1933 that had gone down to 940,000 square yards. What is the use, in all those figures, of simply quoting a slight increase for the year 1932? Everybody knows that the years 1931 and 1932, so far as woollen and worsted textiles were concerned, were the worst two years we have had for 25 or 30 years.

I ask the right hon. Gentleman to tell the Dominions that, in return for the many advantages given to them—and we re-stated definitely 18 months ago what we were prepared to do—we ask for the same treatment from them. It is very interesting indeed, when one examines the Statistical Abstract and the Trade and Navigation Returns, to find that we imported into this country in 1913, from the four Dominions, New Zealand, Australia, Canada and the Union of South Africa, £101,000,000 worth of goods, while in 1933 we imported £146,500,000 worth, an increase of imports of more than £45,000,000. Let us look at exports. To the four Dominions in 1913 we exported £91,289,000 worth of those goods, while by 1933 that figure had gone down to £71,723,000, a decrease of £20,000,000. If one had the time one could conduct a very interesting Debate on the balance of payments which is so often talked about in regard to this question.

I do not want for one moment to say anything that would embitter relations between this country and the Dominions, but we ought to look at these things in proper perspective. When it is claimed that we should treat the Dominions fairly and generously we are at least entitled to claim the same treatment from the Dominions. There can be no complaint of our treatment of them, because of the £45,000,000 increase of imports and the £20,000,000 drop in exports. What I want to ask from the Dominions Secretary is that he should let us have a little more of that plain speaking which he used to use. I agree that we should carry out the Agreements arrived at at Ottawa. We gave our signature, and no one would expect us to do anything else, but the right hon. Gentleman should be equally insistent upon the Dominions carrying out their side of the bargain.

10.2.9 p.m.

The UNDER-SECRETARY of STATE for DOMINION AFFAIRS (Mr. Malcolm MacDonald)

This Debate has ranged almost entirely around one topic. Only one other matter has been scantily mentioned, and that was when certain points were raised in regard to the South African Protectorates. Some of those points were in order, and one was ruled out of order, but my right hon. Friend, with his customary impartiality, replied both to the points that were in order and to those that were out of order, and he very considerably lightened my burden in replying on this Debate. I shall confine myself wholly to the question of the correspondence that has passed between the New Zealand Government and our own. As the hon. Member for South Bradford (Mr. Holdsworth) has said, we have had on that subject an extremely interesting Debate. To my mind not the least interesting feature of it is that, during these six or seven hours, the Liberal Opposition seems to have turned a complete somersault. The hon. Member launched out by charging the Dominions with sending more and more agricultural produce into this country, to the detriment of our own agricultural producers, apparently regardless of the fact that his Leader had opened the Debate with a complaint that we had not given a guarantee to the Dominions that they could go on sending us as much agricultural produce as they liked. I think that, if Members of the Committee will read the opening Liberal speech this afternoon and the closing Liberal speech, they will find that, whether they agree with either of them or not, the one is a reply to the other.

The right hon. Gentleman the Member for Darwen (Sir H. Samuel) and his colleagues have initiated this Debate because they are distressed that our Government has refused an offer made by the New Zealand Government. They regard the correspondence which has been published as containing an offer from the New Zealand Government to give us free entry, or something approaching free entry, for our goods into Now Zealand, if we in return would give them a guarantee for an indefinite period of unrestricted entry for New Zealand produce into the United Kingdom market. My right hon. Friend has explained on more than one occasion that he did not interpret the correspondence as containing any such offer at all, and what he has said was borne out in the very interesting speech of my hon. Friend the Member for the West Derby Division of Liverpool (Sir J. Sandeman Allen), who was in New Zealand when this matter was being discussed there, and was in touch with New Zealand authorities at the time.

My hon. Friend said that his view of the explanation of the original letter was something like this : Ministers in New Zealand were in contact with New Zealand farmers. New Zealand farmers kept on putting up to New Zealand Ministers the suggestion that the United Kingdom Government would be willing to give that kind of guarantee of unrestricted imports in return for the New Zealand Government's making the concession which has been mentioned. And my hon. Friend explained that in his view the New Zealand Government merely sent that inquiry through to us so that they could give an authoritative answer to the farmers' questions.

Vice-Admiral TAYLOR

Does the hon. Gentleman maintain now that that telegram from the Prime Minister of New Zealand was not a definite offer from the New Zealand Government?

Mr. MacDONALD

I was going to deal with that point. I was only explaining that one member of this Committee, who was in New Zealand at the time, has given a perfectly reasonable and certainly an interesting interpretation of that correspondence, and I think we have other important evidence bearing out the interpretation that he put upon it. For even within the last few days, since this controversy arose in this House, we have had a very important speech delivered by a very important member of the New Zealand Cabinet, and that speech itself indicates that the New Zealand Government have not had it in their mind that reciprocal Free Trade between the two countries was a way out of the New Zealand agricultural difficulty. Mr. Coates is the Finance Minister in New Zealand, second in importance only to the Prime Minister, and in a speech delivered on 30th April he made no reference at all to this controversy which was raging here and to the suggested offer made by New Zealand, but he said this. This is from the report of his speech in the "Times" : Mr. Coates declared that the dairy industry was in its present position as a result of its refusal to permit discussion of the British request for a joint effort to improve prices. The best plan was to endeavour to work with Great Britain on a basis of quantitative regulation. That is a declaration of policy by a Minister of the New Zealand Government.

Vice-Admiral TAYLOR

That is his personal opinion.

Mr. MacDONALD

His personal opinion is very much to the point. One cannot go to a higher authority than one of the most responsible members of the New Zealand Government, and that speech indicates that, if there has been any misapprehension about the correspondence that has passed, it has been on the side of those who suggest that it contained an offer by the New Zealand Government proposing some different policy from that propounded by Mr. Coates.

Then I would deal with another point. It seems to have been suggested in some quarters that this whole idea of regulating Dominion imports into this country is something that is being suddenly sprung upon the Dominions and is causing them the most severe heart-burning, and causing them to consider seriously whether it is worth their while belonging to this Empire at all. But I would remind the Committee that the whole question of the right policy for promoting Imperial trade was thrashed out at Ottawa some months ago, and the Dominions' representatives there understood perfectly well that it was at any rate a possibility that the United Kingdom Government would adopt a policy of such restriction, and, in fact, that policy was started by an agreement with the Dominion Ministers at Ottawa. As regards meat, a certain voluntary restriction was agreed between the Australian Ministers and our own Ministers, and the New Zealand Government themselves gave a certain undertaking [Interruption.] The hon. and gallant Gentleman is not even right in his interjection. He says it was subsequent to the original agreement. It is not so. Let him read the agreement, and he will find that it was written into the Ottawa Agreements themselves.

Then we come to the question of dairy produce. Again, the possibility of restriction of Dominion dairy produce was discussed and was written into the original Ottawa Agreements. Here, for instance, is an extract from the agreement with Australia. Schedule A of the Australian Agreement reads as follows : As regards eggs, poultry, butter, cheese and other milk products, free entry for the produce of Australia will be continued for three years certain. His Majesty's Government in the United Kingdom, however, reserve to themselves the right, after the expiration of the three years, if they consider it necessary in the interests of the United Kingdom producer to do so, in consultation with the Commonwealth Government, to bring such produce within any system which may be put into operation for the quantitative regulation of supplies from all sources in the united Kingdom.

Vice-Admiral TAYLOR

The three years is not yet up.

The DEPUTY-CHAIRMAN (Captain Bourne)

I think that we should get on better if the hon. and gallant Member for South Paddington (Vice-Admiral Taylor) did not interrupt so frequently.

Mr. MacDONALD

I am only pointing out that this problem is not being thrust suddenly upon the Dominion Government, but that the whole matter was discussed at Ottawa and has been very much in the front of all Empire Governments during the months which have followed. If the Government of Australia or of New Zealand felt that they were in a position to make an offer of Free Trade, of free imports for our goods into their countries in return for some guarantee from us which would wipe out the possibility of regulation, they were perfectly open to make that offer at the time of the Ottawa Agreements. I believe that anyone who appreciates the revenue position, the industrial position and the political situation in those Dominions, will understand perfectly well that neither then nor now were either the Australian Government or the New Zealand Government in a position to make us an offer of a free entry or anything approaching a free entry into those Dominion markets.

Vice-Admiral TAYLOR

They have done so.

Mr. MacDONALD

It has been suggested that we have turned down some offer which would have been of enormous value to us; that the Dominion of New Zealand has made ran offer to us to reduce her rates of duty against our goods, and that we have turned down that offer. That cannot be reconciled with the Ottawa Agreements themselves because, as a matter of fact, written into the New Zealand Agreement is an undertaking by the New Zealand Government to reduce tariffs against our imports to the lowest possible level which is compatible with the maintenance of her secondary industries. New Zealand could not have gone any further in any offer to us than she has already undertaken to go in the Ottawa Agreement which we signed with her. Here is Article 8 of our Agreement with New Zealand : His Majesty's Government in New Zealand undertake to institute an inquiry into the existing protective duties, and, where necessary, to reduce them as speedily as possible to such a level as will place the United Kingdom producer in the position of a domestic competitor.… We have already got that offer, and not only an offer, but an undertaking, by the New Zealand Government to reduce their duties at the earliest possible moment to the level which will put us on an equal footing with the domestic producer in New Zealand. Does the right hon. Gentleman the Member for Darwen (Sir H. Samuel) suggest that any offer which New Zealand has made recently could possibly go further than that?

Sir H. SAMUEL

Does the hon. Gentleman suggest that that offer from New Zealand meant nothing at all?

Mr. MacDONALD

I have already expressed certain views on that point, and I am certainly not going to elaborate them again now. Here we have an undertaking by the New Zealand Government to reduce their duties at the earliest possible moment to a level which will put our producers on a footing with the New Zealand domestic producers, and any further offer which the New Zealand Government might make could only say that they were going to give us a preferential position as against the New Zealand domestic producers.

On the face of it, it is impossible that any offer could have been made to this country within the last few days which went further than the New Zealand Government have already gone in the Ottawa Agreement. As a matter of fact, the New Zealand Government are already implementing their undertaking. Since the beginning of last year a tariff commission has been sitting in New Zealand, and that commission has been conducting a review of the whole protective tariff of New Zealand, with a view to seeing how far the revenue position in that country would permit the New Zealand Government to carry out the undertakings given in the Ottawa Agreement. Therefore, if hon. Gentlemen on the benches opposite are anxious for a reduction of the New Zealand tariffs against us and if they want to see our producers put on a footing of fair competition with the New Zealand producers, they must be supporters of the Ottawa Agreement between the Dominion and ourselves.

The object of the Ottawa Agreement was an endeavour to establish as much free trade as was practicable in the circumstances of the time between the Dominions and ourselves. I have already indicated how the New Zealand Government undertake to try to establish that state of affairs. But that is not all. As hon. Members know perfectly well, the Australian Government and the Canadian Government also undertook to have inquiries into their tariff schedules and to bring about such reductions in the rates of duty against our imports as would enable our manufacturers to compete fairly with their own. There has been a good deal of progress in that direction since the Ottawa Agreement was signed. I see that hon. Members opposite smile. Let me tell them that reductions of tariffs in Australia, for instance, have been going on steadily for the last two years. One of Australia's undertakings in the Ottawa Agreement was to remove, as soon as the finances of Australia permitted, the primage duty levied against our goods. Australia has now reduced that duty from 10 per cent. to 5 per cent. ad valorem, on approximately 850 protective items and sub-items. In addition, the Australian Government on those same 850 items have instituted a further reduction of one-quarter of the duty, subject to a maximum reduction of 12½ per cent. ad valorem, in part compensation for the rate of exchange.

There we have got very considerable and very valuable reductions of duty on something like 850 items in their tariff schedule. In addition to those reductions, the tariff board in Australia have been sitting and they have recommended, and the Government have carried out, increased duties against our imports on five tariff items, and decreased duties on approximately 182 tariff items. I say, therefore, that, as far as Australia is concerned, as well as in the case of New Zealand, the policy of the Ottawa Agreements of reducing as quickly as possible and as far as practicable the barriers of trade between the Dominions and ourselves is being carried out. In the same way, the Canadian Government have been surmounting their own difficulties. I am not saying that we are entirely satisfied with what the Australians or the Canadians have done; but hon. Members have argued for a policy which was going to reduce tariff barriers, and I am only saying that that policy is being carried out by this Government and by Dominion Governments in co-operation with it to-day.

In the case of Canada there are much greater difficulties, for they had to establish a tariff board. A board was already established in Australia. Then, as my hon. Friend knows, some of our own industrialists must accept a little of the blame for delay, as they have not always been as quick as they might have been in preparing their cases for laying before the tariff board. In the case of Canada, however, duty has been raised on four items of our goods going into that Dominion. The duty has been reduced on approximately 45 items of their tariff schedule. So I must urge that, although we have not been able within two or three years to attain to the ideal state which everybody has spoken about this afternoon, at any rate we are moving in the right direction. At Ottawa we endeavoured to break down as much as possible trade barriers within the Empire, and to establish as far as possible freer trade within the Empire. For our part, we maintained as much free entry for Dominion goods into this country as we possibly could, and we shall maintain that free entry as long as we possibly can consistently with the interests of producers and consumers in our own country.

We have treated the Dominions very well in regard to this dairy produce which has been so much under discussion this afternoon. As my right hon. Friend said earlier in the Debate, there has been a great increase of Dominion imports into this country between 1931, the last complete year before Ottawa, and 1933, the first complete year since Ottawa. In the case of butter, Australian imports in those two years were increased by 8.7 per cent., New Zealand imports by 30.5 per cent. In the case of cheese, the Australian imports were increased by 35.9 per cent., New Zealand imports by 18.9 per cent.—and so on right down the list. I say that that is evidence that we are anxious, as far as we possibly can, to give the Dominions free entry into our markets. If it were to become necessary—if it does become necessary—to impose any restrictions at all upon those imports, those restrictions will in our view be as much in the interests of Dominion agricultural producers as of agricultural producers in this country. I think it was the Noble Lady who pointed out that, although Australian imports of a certain commodity into this country had increased enormously in quantity, the actual money which the Australians received in return for that increased amount was less than they received a year before for a smaller amount of that commodity.

Duchess of ATHOLL

The same applies to New Zealand.

Mr. MacDONALD

The same applies to New Zealand, and it is that kind of fact which makes Mr. Coates say that he wishes the New Zealand producers would accept our policy of regulating imports. The whole essence of our policy will be to increase the price to a remunerative level, both for the home producer and for the Dominion producer, if and when the time comes when that action is necessary in order to maintain prices at that level. We certainly hope that the restrictions will only need to be temporary. We certainly would not seek to impose any restrictions without any consultation with the Dominion concerned, and without an effort at an agreement between us and them on that matter. I see no reason, despite all the difficulties, to suppose that we should not be able to get an agreement in the interests of both parties.

Earl WINTERTON

I presume that at the same time the Government will take steps to deal with the enormous imports from Denmark?

Mr. MacDONALD

I am glad the Noble Lord has intervened if he thought that the impression I was giving to the Committee was that we should take no action at the same time to deal with foreign imports. In any policy of restriction we shall certainly endeavour to abide faithfully by the principles laid down at Ottawa. The Government will pursue a policy in the interests, first, of home producers; secondly, in the interests of Dominion producers; and thirdly, in the interests of foreign producers; and we shall certainly carry out that principle in any policy of restriction which is decided upon. My right hon. Friend earlier gave a series of figures which show that since the Ottawa Agreements were signed our share of the market in every single Ottawa Dominion has increased considerably, and that during the same period the share of these Dominions in our market has increased considerably, that, in fact, since Ottawa, and very largely—to put it no higher—as a result of Ottawa, inter-Imperial trade has increased and is increasing. The policy of this Government in anything it may do in relation to inter-Imperial trade will have primarily as its object the promotion and development of inter-Imperial trade for the welfare of producers and consumers in this country and in the Dominions.

10.58 p.m.

Vice-Admiral TAYLOR

In the two minutes at my disposal I wish to say how much I regret the attitude taken by the Government in their reply to the offer of New Zealand to carry out the full policy of Empire Free Trade. It has been argued that no offer has been made. I ask the Government if it was made, what would be their answer? We have heard a great -deal about the benefits of the Ottawa Agreements to this country and to the Empire, We have been told that restrictions are to be brought in on imports from the Dominions into this country. We have heard very little about the immense volume of foreign imports coming in. We have been told that the policy of the Government is to give this market first to our own producers, then to the Dominion producers, and after that to the foreign producers. I beg the Government, before they start restricting the imports from the Dominions, to restrict the imports from the foreigner. That would be carrying out the policy laid down at Ottawa. I maintain that a direct offer has been made by New Zealand. The Under-Secretary for the Dominions has been at some pains to try to make out that New Zealand could not have gone further than she agreed to go at Ottawa, that she could not reduce her tariffs below those agreed at Ottawa, that she could not give us Free Trade. That was the argument advanced. Why not? What is to prevent New Zealand, if she wishes, removing her tariffs against us? Here is a great Dominion ready to accept the

full policy of Empire Free Trade; a policy scoffed at three years ago, but to-day an actual fact; and we turn it down. What effect must it have on the remainder of our Dominions? I am delighted to have had an opportunity of exposing the scurvy way in which a trade offer from the Dominion of New Zealand has been received by this Government.

Question put, "That a sum, not exceeding £36,518, be granted for the said Service."

The Committee divided : Ayes, 38; Noes, 207.

Division No. 245.]	AYES.	[11.1 p.m.
Acland, Rt. Hon. Sir Francis Dyke	Hamilton, Sir R. W. (Orkney & Zetl'nd)	Procter, Major Henry Adam
Adams, D. M. (Poplar, South)	Harris, Sir Percy	Roberts, Aled (Wrexham)
Attlee, Clement Richard	Holdsworth, Herbert	Rothschild, James A. de
Batey, Joseph	Janner, Barnett	Samuel, Rt. Hon. Sir H. (Darwen)
Cape, Thomas	Jones, Henry Haydn (Merloneth)	Sinclair, Maj. Rt. Hn. Sir A. (C'thness)
Cripps, Sir Stafford	McEntee, Valentine L.	Smith, Tom (Normanton)
Foot, Dingle (Dundee)	Maclean, Neil (Glasgow, Govan)	Taylor, vice-Admiral E. A. (P'dd'gt'n. S.)
Foot, Isaac (Cornwall, Bodmin)	Mander, Geoffrey le M.	Tinker, John Joseph
George, Major G. Lloyd (Pembroke)	Mason, David M. (Edinburgh, E.)	White, Henry Graham
Graham, D. M. (Lanark, Hamilton)	Maxton, James.	Wilmot, John
Greenwood, Rt. Hon. Arthur	Milner, Major James
Grenfell, David Rees (Glamorgan)	Nathan, Major H. L.	TELLERS FOR THE AYES.—
Griffith, F. Kingsley (Middlesbro', W.)	Owen, Major Goronwy	Mr. Walter Rea and Mr. Harcourt
Groves, Thomas E.	Pickering, Ernest H.	Johnstone.
NOES
Acland-Troyte, Lieut. -Colonel	Crossley, A. C.	Hasiam, Sir John (Bolton)
Agnew, Lieut.-Com. P. G.	Cruddas, Lieut.-Colonel Bernard	Headlam, Lieut.-Col. Cuthbert M.
Allen, Lt.-Col. J. Sandeman (B'k'nh'd.)	Davidson, Rt. Hon. J. C. C.	Henderson, Sir Vivian L. (Chelmsford)
Amery, Rt. Hon. Leopold C. M. S.	Davies, Edward C. (Montgomery)	Heneage, Lieut.-Colonel Arthur P.
Apsley, Lord	Davies, Maj. Geo. F. (Somerset, Yeovil)	Hepworth, Joseph
Aske, Sir Robert William	Dawson, Sir Philip	Hornby, Frank
Astor, Maj. Hn. John J. (Kent, Dover)	Dickie, John p.	Horsbrugh, Florence
Baldwin, Rt. Hon. Stanley	Dixey, Arthur C. N.	Howard, Tom Forrest
Balfour, Capt. Harold (I. of Thanet)	Dugdale, Captain Thomas Lionel	Howitt. Dr. Alfred B.
Bateman, A. L.	Duggan, Hubert John	Hudson, Capt. A. U. M. (Hackney, N.)
Beaumont, M. W. (Bucks., Aylesbury)	Dunglass, Lord	Hume, Sir George Hopwood
Beaumont, Hon. R. E. B. (Portsmith, C.)	Edmondson, Major A. J.	Hunter, Dr. Joseph (Dumfries)
Boulton, W. W.	Ellis, Sir R. Geoffrey	Hunter, Capt. M. J. (Brigg)
Bower, Lieut.-Com. Robert Tatton	Elliston, Captain George Sampson	Inskip, Rt. Hon. Sir Thomas W. H.
Bowyer, Capt. Sir George E. W.	Elmley, Viscount	Jesson, Major Thomas E.
Brass, Captain Sir William	Emmott, Charles E. G. C.	Joel, Dudley J. Barnato
Broadbent, Colonel John	Emrys-Evans, P. V.	Jones, Sir G. W. H. (Stoke New'gton)
Brocklebank, C. E. R.	Erskine, Lord (Weston-super-Mare)	Kerr, Lieut.-Col. Charles (Montrose)
Brown, Col. D. C. (N'th'l'd., Hexham)	Essenhigh, Reginald Clare	Kerr, Hamilton W.
Brown, Ernest (Leith)	Fleming, Edward Lascelles	Knight, Holfard
Brown, Brig.-Gen. H. C. (Berks., Newb'y)	Ford, Sir Patrick J.	Leckie, J. A.
Buchan-Hepburn, P. G. T.	Fraser, Captain Ian	Leech, Dr. J. W.
Burghley, Lord	Fremantle, Sir Francis	Leighton, Major B. E. P.
Burgin, Dr. Edward Leslie	Fuller, Captain A. G.	Liddall, Walter S.
Burnett, John George	Ganzonl, Sir John	Lindsay, Kenneth (Kilmarnock)
Cadogan, Hon. Edward	Gault, Lieut.-Col. A. Hamilton	Lindsay, Noel Ker
Campbell-Johnston, Malcolm	Gillett, Sir George Masterman	Little, Graham-, Sir Ernest
Castlereagh, Viscount	Gilmour, Lt.-Col. Rt. Hon. Sir John	Loder, Captain J. de Vere
Cazalet, Thelma (Islington, E.)	Glyn, Major Sir Ralph G. C.	Loftus, Pierce C.
Clarry, Reginald George	Goff, Sir Park	Lovat-Fraser, James Alexander
Cochrane, Commander Hon. A. D.	Goldie, Noel B.	Lyons, Abraham Montagu
Collins, Rt. Hon. Sir Godfrey	Goodman, Colonel Albert W.	MacAndrew, Lieut.-Col. C. G.(Partick)
Colman, N. C. D.	Graham, Sir F. Fergus (C'mb'rl'd, N.)	McCorquodale, M. S.
Colville, Lieut.-Colonel J.	Grigg, Sir Edward	MacDonald, Rt. Hn. J. R. (Seaham)
Cook, Thomas A.	Grimston, R. V.	MacDonald, Malcolm (Bassetlaw)
Cooke, Douglas	Guest, Capt. Rt. Hon. F. E.	Macdonald, Sir Murdoch (Inverness)
Cooper, A. Duff	Guinness, Thomas L. E. B.	McKie, John Hamilton
Copeland, Ida	Gunston, Captain D. W.	Maclay, Hon. Joseph Paton
Courtauld, Major John Sewell	Hacking, Rt. Hon. Douglas H.	McLean, Dr. W. H. (Tradeston)
Courthope, Colonel Sir George L.	Hales, Harold K.	Macquisten, Frederick Alexander
Crooke, J. Smedley	Hammersley, Samuel S.	Margesson, Capt. Rt. Hon. H. D. R.
Crookshank, Capt. H. C. (Galnsb'ro)	Hanley, Dennis A.	Mayhew, Lieut.-Colonel John
Cross, R. H.	Harvey, Major S. E. (Devon, Totnes)	Mills, Major J. D. (New Forest)
Milne, Charles	Ross Taylor, Walter (Woodbridge)	Sutcliffe, Harold
Monsell, Rt. Hon. Sir B. Eyres	Ruggles-Brise, Colonel E. A.	Thomas, Rt. Hon. J. H. (Derby)
Moore, Lt.-Col. Thomas C. R. (Ayr)	Runge, Norah Cecil	Thomas, James P. L. (Hereford)
Morris, Owen Temple (Cardiff, E.)	Russell, Hamer Field (Sheffield, B'tslde)	Thomson, Sir Frederick Charles
Morris-Jones, Dr. J. H. (Denbigh)	Salmon, Sir Isidore	Thorp, Linton Theodore
Morrison, G. A. (Scottish Univer'ties)	Sandeman, Sir A. N. Stewart	Titchfield, Major the Marquess of
Morrison, William Shepherd	Sanderson, Sir Frank Barnard	Tree, Ronald
Nation, Brigadier-General J. J. H.	Savery, Samuel Servington	Tryon, Rt. Hon. George Clement
Nunn, William	Shakespeare, Geoffrey H.	Tufnell, Lieut.-Commander R. L.
O'Donovan, Dr. William James	Shaw, Helen B. (Lanark, Bothwell)	Wallace, Captain D. E. (Hornsey)
Patrick, Colin M.	Shaw, Captain William T. (Forfar)	Wallace, John (Dunfermilne)
Peake, Captain Osbert	Sinclair, Col. T. (Queen's Unv., Belfast)	Ward, Lt.-Col. Sir A. L. (Hull)
Peat, Charles u.	Smith, Sir J. Walker- (Barrow-in-F.)	Ward, Sarah Adelaide (Cannock)
Perkins, Walter R. D.	Somerville, Annesley A. (Windsor)	Warrender, Sir Victor A. G.
Petherick, M.	Spears, Brigadier-General Edward L.	Whyte, Jardine Bell
Peto, Geoffroy K.(W'verh'pt'n, Bilston)	Spencer, Captain Richard A.	Williams, Charles (Devon, Torquay)
Potter, John	Spender-Clay, Rt. Hon. Herbert H.	Williams, Herbert G. (Croydon, S.)
Powell, Lieut.-Col. Evelyn G. H.	Spens, William Patrick	Wills, Wilfrid D.
Power, Sir John Cecil	Stanley, Rt. Hon. Lord (Fylde)	Wilson, G. H. A. (Cambridge U.)
Ramsay T. B. W. (Western Isles)	Stewart, J. H. (Fife, E.)	Windsor-Cilve, Lieut.-Colonel George
Ramsden, Sir Eugene	Stones. James	Winterton, Rt. Hon. Earl
Ray, Sir William	Storey, Samuel	Womersley, Walter James
Reed, Arthur C. (Exeter)	Strauss, Edward A.	Worthington, Dr. John V.
Reid, William Allan (Derby)	Strickland, Captain W. F.
Rickards, George William	Stuart, Lord C. Crichton-	TELLERS FOR THE NOES—
Ropner, Colonel L.	Sueter, Rear-Admiral Sir Murray F.	Mr. Blindell and Commander
Rosbotham, Sir Thomas	Sugden, Sir Wilfrid Hart	Southby

Original Question again proposed.

It being after Eleven of the Clock, and objection being taken to further Proceedings, The CHAIBMAN left the Chair to make his Report to the House.

Committee report Progress; to sit again To-morrow.

The remaining Orders were read, and postponed.

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1. ADJOUENMENT. 16 words