HC Deb 12 May 1936 vol 312 cc339-52

11.13 p.m.


I beg to move, That the Additional Import Duties (No. 8) Order, 1936, dated the fifteenth clay of April, nineteen hundred and thirty-six, made by the Treasury under the Import Duties Act, 1932, a copy of which was presented to this House on the twenty-first day of April, nineteen hundred and thirty-six, be approved. In accordance with our usual practice, I propose to make a short introductory statement covering the three Orders on the Paper, and hon. Members can, if they wish, put questions to me on any of the Orders, while it will, of course, be open to the House to divide on each Order. These Orders relate to hair combs, to certain chemicals, notably sodium bichromate, and metal capsules. Order No. 9, dealing with chemicals, will probably be disposed of very readily. Orders Nos. 8 and 10 are relatively simple. As regards hair combs, the proposal is that an additional duty of 8s. per gross should be put on as an alternative to the recent duty of 20 per cent. The new duty is directed mainly against Japanese competition. The average declared value of the imports was something like 20s, and the average declared value of the imports from Japan in February, 1936, was only Os. 10d, a gross, and the quantity of imports from Japan increased from nothing at all in 1930 to 126,000 gross in 1935. Japan indeed was sending to this country more than half the total imports of hair combs. The British manufacturers have given the Committee assurances that increased prices to wholesalers should involve no change in the existing low retail prices to the consumer, and the English manufacturers have pointed out that a higher output may even enable the price to be lowered. I should imagine that, there is very little in regard to that Order dealing with combs which would require discussion.


Would the Parliamentary Secretary inform the House what is the price of British combs compared with the 6s. 10d. and 8s. a gross?


The value is about 17s. 6d., or something of that order. I do not wish to mislead the House in that, because it is difficult to give an average price over a large range of articles. Suffice it to say that 6s. 10d. a gross is only about a third of the value per gross of the British combs. No. 10 Order deals with metal capsules used for sealing bottles and jars. There was a duty of 20 per cent. and for this 20 per cent. a combined duty is now made up of an ad valorem duty of 15 per cent. plus 1s. 8d. per 1,000 capsules. The Order took effect on 2nd May. The imports have increased from 42,000,000 to 86,000,000. The United Kingdom producers were not able to take full advantage of reduced imports. Prices of foreign capsules in the home markets are much higher than those at which these foreign capsules are exported to the United Kingdom, because of deliberate under-selling by foreign producers, which is a severe handicap to United Kingdom producers. The home industry has a strong claim for further protection, and the Import Duties Advisory Committee are of opinion that any rise in price which might follow the increase in duty should have a negligible effect on the consuming industries, by far the largest industry being the wine and spirit trade, which could be counted as a luxury trade.

That leaves No. 9 Order, and if I rightly understand the wish of hon. Members, it would be that on No. 9 Order I should give a little more information. This Order deals with sodium bichromate and potassium bichromate. These are substances which are used in the chrome tanning of skin which is a more rapid process than the vegetable tanning of skin. They are used largely for light leathers, box and willow calf, and only to a small extent for sole leather. These goods were formerly charged only with the general ad valorem duty and the proposal is that sodium bichromate should be charged with a rate of duty of 8s. per hundredweight and that potassium bichromate should be charged 10s. per hundredweight. The home and the export trade in these commodities is, in a large measure, subjected to control by an international cartel, and that control has been exercised in a reasonable manner and orderly marketing has been possible. The agreement is only a short-term one, running from year to year, and in the Committee's opinion the United Kingdom market is relatively unprotected, and there is a good deal of insecurity. This lack of protection has exposed the British manufacturer to competition from independent foreign producers who, by undercutting, have increased their trade in this country.

The home manufacturers have given a. very elaborate assurance as to prices. I want the House to pay particular attention to the terms of the assurance as to prices, which in a moment I will read. The home production is carried on at a number of places, chiefly Glasgow, near Bolton, and County Durham. The production capacity is ample for home and export requirements, and the number of workpeople is something like 600. The imports have came in largely from Russia and Japan. The price assurance which I am anxious to give to the House is this: The large firms of manufacturers of these substances have given the assurance that they will not increase the present prices of either of these chemicals except in so far as increases are justified by an alteration, extending over a period of a month or more in any of the raw materials, that is chrome ironstone, alkali and coal, and an alteration of wages. They have given an undertaking that they will reduce the prices of these chemicals to the extent justified by a reduction in costs of production resulting from any of the same causes. There is thus a very satisfactory assurance given to the Import Duties Advisory Committee with regard to the prices charged to the consuming interests. The Russian and Japanese producers are outside the international cartel. Sodium bichromate has been coming in from Russia—2,500 cwts. in 1932 and 10 times as much in 1935. The increase in three years of Russian exports of this chemical which is used as a raw material in the tanning industry has been multiplied by 10. The details of imports from Japan show that the quantities have multiplied by two in 1935 as compared with 1934. So that we have the curious spectacle of Russia and Japan, the two producing countries outside the cartel, multiplying their exports to this country very largely in the years that have followed 1932. This is a trade that can perfectly well be supplied from within our own boundary, and price undertakings have been given. I think, the House will therefore have no hesita- tion in approving this Order, which I believe is the substantive order of these three. The other Orders are relatively small.

11.24 p.m.


I should like to ask the Minister whether there is any evidence that Russia has been attempting seriously to cut prices, or whether the fact that Russia has extended her imports so tremendously has enabled her to reduce prices so that the prices of the cartel are higher than are warranted?

11.25 p.m.


I wish to say a word about the Import Duty on combs. A duty of 8s. per gross on top of the present price of 6s. 10d. will make the price of the imported Japanese article 14s. 10d. per gross, as against 17s. 6d. for the English article. As one who had to handle these goods some years ago I should say that the English combs, costing 17s. 6d. per gross, would be reckoned as costing ls. 6d. a dozen and would be sold in shops which do a big sale at 2d. each or in smaller shops at 2½d. What is the position with regard to the Japanese article—not that I say that it ought to be brought in at a price which does not allow the worker here to get a living wage, but one must consider the effect of this protection upon people who live in a poor neighbourhood like my own? These combs are being broken every week; they do not last very long. Under ordinary business conditions Japanese combs bought at 6s. 10c1. per gross would be put into stock as costing 7s. ld., equivalent to roughly ½d. per comb, and the retail price in the shops would be ld. I do not know whether the Parliamentary Secretary has had any experience of marking up stock, or whether he has ever got as low as marking up combs. I have had to stock combs and I should certainly mark up those combs at 7s. per gross. With the addition of the import duty the price of the Japanese combs will be brought up to near the English price of 17s. 6d. per gross. Then it may be that a trader will not stock the two classes of combs. When there is only a difference of 2s. per gross the English article may be pushed out of the road and the 14s. 10d. line take its place. In that case what protection will there be for many of the small industries up and down the country?

I look upon the invasion of cheap Japanese goods as being of no benefit to the workers of this country. If a commodity which is in everyday demand is to be brought in at a profit that makes it more beneficial to the manufacturer to import combs rather than to make others, many small makers of combs will go out of business, or will use their warehouses to store Japanese goods instead of making combs. A good deal of business is done in the making of combs, and I want every opportunity for our workers to gain a fair livelihood. It would not be fair to allow these goods to come into the market unless there were some guarantee that the British goods would not be raised in price and that the manufacturers would not drop the home commodity in order to put the Japanese article on the market at a higher price.

11.31 p.m.


May I put a question about Order Number 9? Would the Parliamentary Secretary tell us what the percentage of the Specific Duty is upon the C.I.F. cost?


It is 29 per cent.


On a point of Order. I understood, Mr. Speaker, that you put Order Number 8. Are we discussing all three Orders together?


That point was raised at the beginning of the discussion.


Has there been any objection from the textile interests to these Orders? One or two sentences occur in this Order that many of my textile friends would challenge. It is always interesting to see the phraseology of the Import Duties Advisory Committee. This is one sentence, speaking of the cartel: We have no reason to doubt that that control, which regulates prices at levels of which substantial sections of the consumers would complain… "Substantial" may mean anything. The Colour Users' Association do me the honour of sending me their report every year, and I have never yet seen a report that did not complain of the prices since the cartel arrangement. The Order goes on to say: The United Kingdom market is relatively unprotected. I do not know how that can be true. Anybody who knows the workings of that cartel knows that it is better than any protection that can be given.

I should appreciate it if some of these Orders could be put on to the programme of business of this House for a reasonable hour, when we should be able to debate them seriously. I know the difficulties of the Patronage Secretary in arranging business, but these Orders affect thousands of traders, and we should be glad to give more time to them than can be given after 11 o'clock at night. We all go into the Lobbies to vote on the suspension of the Eleven o'Clock Rule, but there is a general shout if anybody gets up to speak after 11 o'clock. I know that the Patronage Secretary is not responsible for these Orders being put on after 11, but it is not fair to him or to the House to do so, and an earlier hour should be given to the study of the Orders.


Do I understand the hon. Gentleman to say that 126,000 gross of these combs were imported into this country during last year?


From Japan.


Over 18,000.000.

11.35 p.m.


The total import of combs from foreign countries is 200,000 gross, and Japan, which exported none at all to this country in 1930, had, by five years of intensive under-cutting, won an entry here to the extent of 126,926 gross out of the total of 200,000 gross.

Apart from the questions with regard to Order No. 8, which deals with combs, the questions that have been put to me have been, as I expected, directed to Order No 9, which deals with the textile trade. The hon. Member for the Scotland Division of Liverpool (Mr. Logan) will, of course, understand that, although more than half our total import of combs comes from Japan, there are considerable imports from Germany, France and other countries, but the average declared value of Japanese combs is well under one-third of the value of the German combs, and we have to legislate for the whole of the imports that come in. It will interest the hon. Member to know that these combs are sold in the multiple stores at 2d. to 3d.—I am not dealing with the 1d. ones at all—and that the British manufacturers sell their infinitely better combs at the same price and have given an undertaking that that price shall not be raised. On the contrary, with the production of a greater number to take the place of these foreign imports, which we intend to exclude by this duty, there is a reasonable hope of their price coming down. The Committee, who have received these assurances, are satisfied that the production capacity of the industry in this country is great enough to enable it to expand and that this is a type of trade which it can well supply; and there is every confidence that this duty, high and therefore prohibitive for most countries, and difficult so far as Japan is concerned, materially reducing the profit that a merchant might be tempted to obtain by selling cheaper combs imported from Japan, will induce a considerably greater consumption of British combs; and I think the arguments used in that regard by the Import Duties Advisory Committee are likely to commend themselves to the House.

With regard to Order No. 9, the hon. Member for Chesterfield (Mr. Benson) asks whether it is not possible that Russia's ability to send to this country at low prices does not really show that the local price is too high; and the hon. Member for South Bradford (Mr. Holdsworth) says: "What do you mean by saying that this country is relatively unprotected? Look at the Cartel." It is because the international Cartel does not include Russia and Japan, who are independent producers working outside the Cartel and have chosen, in order to gain an entry into this market, systematically to undercut, that the exports from Russia have increased so very largely. It is not because Russia has been demonstrating that the British prices are too high; it is because Russia has been systematically under-selling in order to gain a place in the market that this duty has become necessary. I do not accept the hon. Member's inference that the British makers of these substances are charging too high a price: I do not think that is borne out at all. The materials used in the textile trade cost approximately £10,000,000 a year, the gross output of the textile trade is about £30,000,000 a year and the total value to the finishing trade of bichromate of sodium and potassium amounts to £37,000, so that on a cost of £10,000,000, producing a finished result of £30,000,000 the cost price of the chemicals is £37,000. It is obvious that the effect of the new duty on these substances coming in from two countries whose exports we desire to see diminished will not be any serious handicap to our industry.

The hon. Member for South Bradford (Mr. Holdsworth) asks if there was any opposition. Yes, there was. Was there any large body of consumers who did not object? Yes, there was. The opposition before the Import Duties Advisory Committee, based on allegations that the price of British bichromate had been too high came from certain users of these materials in the textile industry. The United Tanners' Federation did not oppose. They were satisfied with the declaration made by the bichromate manufacturers, but the Allied Association of Bleachers intimated that they were unwilling, on grounds of principle, to co-operate. The manufacturers undertake to communicate grounds for proposing any increase in price and the declaration that has been obtained by the Import Duties Advisory Committee, as a condition of making these recommendations, is in the terms that I have read out, that the prices of sodium and potassium bichromate shall not be raised except to the extent to which raw materials or wages render the cost of manufacture greater and, on the contrary, if the cost of materials or wages falls, the price will be correspondingly reduced. I think that undertaking is of a kind that has commended itself to the House before and is in terms which should be accepted again. [Interruption.]I am not quite sure of that off-hand, but application should be made to the import Duties Advisory Committee if in the opinion of consumers the terms of the undertaking have not been properly kept. I have not given any thought to the hon. Member's last question. I may perhaps reflect on that and write to him. It may well be that, if this comes under the general category of dyestuffs, the greater will include the less but, dealing with the Order by itself, the promise given to the consuming interests is satisfactory and, if it works unfairly, further application should be made to the body that has made the recommendation.

11.44 p.m.


I would add my protest to that of the hon. Member with regard to the absurdity of these very important new taxation proposals being always discussed at 11 o'clock. I beg the Parliamentary Secretary to the Treasury to co-operate with the Board of Trade in trying to arrange for a more reasonable time for these discussions. Otherwise, while we are apparently on occasion after occasion almost docile in the brevity with which we tackle this question after 11 o'clock, the House must face the taking of other measures to force the Government to provide adequate time for the consideration of these important questions. There is very great substance in the references of the hon. Member for South, Bradford (Mr. Holdsworth) to the wording of these reports. 'Who is there that can imagine from reading the actual report in regard to Order No. 9 that the true facts were as given by the Parliamentary Secretary in his reply to a question? One could not possibly imagine from the report itself that there had been such a very important body of opposition from great sections of the textile industry. That again indicates the injustice of the present procedure. It is intolerable that such large and heavily increased taxation should be placed on industry without adequate information being before the House as to the real position. Perhaps the Parliamentary Secretary may well say, "I have given the information in reply to questions," but the House is entitled to have that information on paper before it considers the Order, so as to be able to give a sound judgment as to whether the tax is right or wrong. Hon. Members who made that point are completely justified. Nothing is more vicious than taxing the citizens of one particular country in order to maintain the price level of an international cartel.

That is really the object of this Order. The Parliamentary Secretary has been perfectly frank about it. That applies in regard to other commodities, which are the subject of recommendations, at various times, of the Import Duties Advisory Committee. We are being asked to-night to give approval to the taxation of British subjects, including important users of this commodity as a raw material, in order to keep up the general price level of an international cartel and for the distribution of profits to inter- national shareholders. When these questions are raised we always have the assurance that prices will not be increased to the consumer, but the fact is that, as the result of the procedure of the Import Duties Advisory Committee, you are taxing the people to-day in this country, and are raising additional revenue of over £70,000,000 more than in 1931. That means that Import Duties Revenue is being collected apparently under the Import Duties Act, and under increased customs of every kind, and you have, in fact, the goods still coming in. You are getting the revenue, and the people who use the goods are paying the taxation. You are taxing them the whole time, both in regard to finished articles and raw materials, and, therefore, the argument that has been put forward is like a receptacle that will not hold water, you are up against the old dilemma—which the tariff reformer never could answer—that, if you are to get revenue, you are bound to let goods in, and if you keep goods out, there will not be any revenue. If you talk about taxing the foreigner in this connection, you must have a new and more direct tax than you have under the procedure of your latest Import Duties Act.

I will not say anything about the Order dealing with combs, as my hon. Friend the Member for the Scotland Division (Mr. Logan) has spoken on the subject, but on the point made with regard to capsules, the House should not ride away with the idea that it is going to affect only the wine and spirit trade. That is quite untrue. I can speak with considerable experience of the matter. The duty will affect the price of capsules on almost every class of bottle and food preparations. If the Parliamentary Secretary shakes his head, let me tell him that there is an increasing tendency in many trades to drop other forms of cover for these containers, to drop corks and other things and to turn to capsules. If his Department does not know that fact, it ought to know it. The people in the trade know it. This particular duty will put up all these costs. For that reason we are opposed to the action which the Government are asking the House to approve. I beg the Patronage Secretary, in view of the feeling in the House, to see that we get a better time in future for the discussion of these questions.

Resolved, That the Additional import Duties (No. 8) Order, 1936, dated the fifteenth day of April, nineteen hundred and thirty-six, made by the Treasury under the Import Duties Act, 1932, a copy of which was presented to this House on the twenty-first day of April, nineteen hundred and thirty-six, be approved.

Motion made, and Question put, That the Additional Import Duties (No. 9) Order, 1936, dated the twenty-

second day of April, nineteen hundred and thirty-six, made by the Treasury under the Import Duties Act, 1932, a copy of which was presented to this House on the said twenty-second day of April, nineteen hundred and thirty-six, be approved."—[Dr. Burgin.]

The House divided: Ayes, 137; Noes; 51.

Division No. 184.] AYES. [11.50 p.m.
Acland-Troyte, Lt.-Col. G. J. Emery, J. F. Petherick, M.
Adams, S. V. T. (Leeds, W.) Emrys-Evans, P. V. Ponsonby, Col. C. E.
Agnew, Lieut. -Comdr. P. G. Entwistle, C. F. Porritt, R. W.
Anderson, Sir A. Garrett (C. of Ldn.) Erskine Hill, A. G. Procter, Major H. A.
Apsley, Lord Fremantle, Sir F. E. Radford, E. A.
Aske, Sir R. W. Furness, S. N. Raikes, H. V. A. M.
Astor, Hon. W. W. (Fulham, E.) Fyfe, D. P. M. Ramsden, Sir E.
Atholl, Duchess of Goodman, Col. A. W. Rankin, R.
Baldwin-Webb, Col. J. Guest, Maj. Hon. O.(C'mb'rw'll,N.W.) Rathbone, J. R. (Bodmin)
Balfour, Capt. H. H.(Isle of Thanet) Guy, J. C. M. Reed, A. C. (Exeter)
Barclay-Harvey, C. M. Hanbury, Sir C. Remer, J. R.
Baxter, A. Beverley Hannah, I. C. Rickards, G. W. (Skipton)
Beaumont, M. W. (Aylesbury) Hannon, Sir P. J. H. Ropner, Colonel L.
Beaumont, Hon. R. E. B. (Portsm'h) Harbord, A. Ross Taylor, W. (Woodbridge)
Bernays, R. H. Hartington, Marquess of Salt, E. W.
Blindell, Sir J. Hepburn, P. G. T. Buchan- Samuel, M. R. A. (Putney)
Bossom, A. C. Herbert, Major J. A. (Monmouth) Scott, Lord William
Boulton, W. W. Holmes, J. S. Smith, Sir R. W. (Aberdeen)
Boyce, H. Leslie Hope, Captain Hon. A. O. J. Somervell, Sir D. B. (Crewe)
Bracken, B. Horsbrugh, Florence Southby, Comdr. A. R. J.
Browne, A. C. (Belfast, W.) Hudson, Capt. A. U. M. (Hack., N.) Spears, Brig.-Gen. E. L.
Bull, B. B. Hunter, T. Spens, W. P.
Bullock, Capt. M. James, Wing-Commander A. W. Stourton, Hon. J. J.
Burghley, Lord Keeling, E. H. Strauss, H. G. (Norwich)
Burgin, Dr. E. L. Kerr, J. G. (Scottish Universities) Strickland, Captain W. F.
Butler, R. A. Leckie, J. A. Sutcilffe, H.
Cary, R. A. Leech, Dr. J. W. Taylor, C. S. (Eastbourne)
Cayzer, Sir C. W. (City of Chester) Liddall, W. S. Thomas, J. P. L. (Hereford)
Cazalet, Thelma (Islington, E.) Lieweliln, Lieut.-Col. J. J. Thomson, sir J. D. W.
Channon, H. Lyons, A. M. Tree, A. R. L. F.
Chapman, A, (Ruthergien) Mabane, W. (Huddersfield) Tufnell, Lieut.-Com. R. L.
Christle, J. A. M'Connell, Sir J. Wakefield, W. W.
Colman, N. C. D. McKie, J. H. Walker-Smith, Sir J.
Colville, Lt.-Col. D. J. Maclay, Hon. J. P. Ward, Lieut.-Col. Sir A. L. (Hull)
Courthope, Col. Sir G. L. Magnay, T. Ward, Irene (Walisend)
Craven-Ellis, W. Margesson, Capt. Rt. Hon H. D. R. Waterhouse, Captain C.
Crooke, J. S. Mayhew, Lt.-Col. J. Wedderburn, H. J. S.
Cross, R. H. Mellor, Sir J. S. P. (Tamworth) Wells, S. R.
Crowder, J. F. E. Morris, O. T. (Cardiff, E.) Williams, H. G. (Croydon, S.)
Culverwell, C. T. Morrison, G. A. (Scottish Univ's.) Windsor-Clive, Lieut.-Colonel G.
Davies, C. (Montgomery) Morrison. W. S. (Cirencester) Wise, A. R.
Davies, Major G. F. (Yeovil) Muirhead, Lt.-Col. A. J. Womersley, Sir W. J.
De Chair, S. S. Nail, Sir J. Young, A. S. L. (Partick)
Duggan, H. J. Neven-Spence, Maj. B. H. H.
Duncan, J. A. L. Nicoison, Hon. H. G. TELLERS FOR THE AYES.—
Dunne, P. R. R. Orr-Ewing, I. L. Sir George Penny and Mr. James
Eckersley, P. T. Peake, O. Stuart.
Adamson, W. M. Greenwood, Rt. Hon. A. Price, M. P.
Alexander, Rt. Hon. A. V. (H'lsbr.) Griffith, F. Kingsley (M'ddl'sbro, W.) Ritson, J.
Barr, J. Griffiths, G. A. (Hemsworth) Robinson, W. A. (St. Helens)
Benson, G. Griffith, J. (Llaneily) Rowson, G.
Bevan, A. Hall, G. H. (Aberdare) Sexton, T. M.
Bromfield, W. Henderson, J. (Ardwick) Simpson, F. B.
Burke, W. A. Henderson, T, (Tradeston) Smith, E. (Stoke)
Compton, J. Holdsworth, H. Stewart, W. J. (H'ght'n-le-Sp'ng)
Daggar, G. Jenkins, A. (Pontypool) Taylor, R. J. (Morpeth)
Dalton, H. Jenkins, Sir W. (Neath) Tinker, J. J.
Dunn, E. (Rother Valley) Jones, H. Haydn (Merioneth) Watson, W. McL.
Ede, J. C. Kirby, B. V. Westwood, J.
Edwards, Sir C. (Bedwellty) Logan, D. G. White, H. Graham
Evans, D. O. (Cardigan) Macdonald, G. (Ince) Williams, E. J. (Ogmore)
Evans, E. (Univ. of Wales) MacLaren, A. Woods, G. S. (Finsbury)
Garro-Jones, G. M. Marklew, E
George, Major G. Lloyd (Pembroke) Paling, W. TELLERS FOR THE NOES.—
Gibbins, J. Potts, J. Mr. John and Mr. Mathers.

Resolved, That the Additional Import Duties (No. 10) Order, 1936, dated the thirtieth day of April, nineteen hundred and thirty-six, made by the Treasury under the Import Duties Act, 1932, a copy of which was presented to this House on the said thirtieth day of April, nineteen hundred and thirty-six, be approved."—[Dr. Burgin.]

The remaining Orders were read, and postponed.

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

Adjourned at Two Minutes after Twelve o'Clock.