IMPORT DUTIES (IMPORT DUTIES ACT, 1932) (IRON AND STEEL GOODS). (Hansard, 16 June 1937)

§ The Parliamentary Secretary to the Board of Trade (Captain Euan Wallace)
I beg to move: That the Additional Import Duties (No. 6) Order, 1937, dated the twenty-fifth day of May, nineteen hundred and thirty-seven, made by the Treasury under the Import Duties Act, 1932, a copy of which was presented to this House on the said twenty-fifth day of May, nineteen hundred and thirty-seven, be approved. It is a little difficult at this late hour to know how much, or rather how little, to say on this Order. I am most anxious to avoid appearing casual, ignorant or evasive, and I am equally anxious not to deserve the accusation of being longwinded. I do not think the House will wish me to go into the earlier action taken under Section 6 of the Finance Act, 1936, which set up the licensing scheme for iron and steel imports in order to implement the Agreement of July, 1935, between the British Iron and Steel Federation and the Continental Steel Cartel. I will, therefore, take hon. Members immediately to 22nd March of this year when the Additional Duties No. 3 Order was discussed in this House, and produced a most interesting Debate of three and a half-hours, in which Mr. Runciman, as he then was, and my distinguished predecessor who is now Minister of Transport, participated. On that occasion the whole situation was explained at length to the House and hon. Members were made aware of the reasons for which the 10 per cent. additional duty was removed from the iron and steel imports which come in under the licensing scheme, leaving them only subject to the general ad valorem duty of xo per cent. It is hardly necessary to say that the House on that occasion gave a favourable reception to the Order. That particular Order, No. 3, contained a Schedule giving a list of goods to which the licensing scheme applied, and the descriptions of some of these goods were qualified by limits of value, in such a way that goods of those descriptions exceeding the value limits shown could not be imported into the country except at the normal and higher rate of duty. The articles in question were ingots, blooms 518 billets and slabs, £7 10s. per ton; angles, shapes and sections, £15 per ton; bars and rods, £9 per ton; and plates, sheets, hoop and strip £16 per ton. The particular limits set down in the Schedule were those which were used in negotiating the commercial agreements with Norway and Sweden in 1933, and we had these particular limits of value for the purpose of conventionalising the duties on iron and steel goods which exceeded these limits. These particular figures were appreciably above the prices which had ruled for a long time for the main range of imports with which the Continental Steel Cartel was concerned; and, since the great bulk of our imports from cartel countries were of a lower quality of iron and steel than the goods covered by the agreements of 1933, we found it extremely convenient to adopt these particular figures as the upper limits for the operation of the licensing scheme.
It was to goods of these particular kinds below the values I have stated that No. 3 Order, which the House passed without a Division less than three months ago, applied. Since then there has been a world wide rise in the prices of iron and steel goods, the result of which has been that the prices of certain products in the cartel agreement now exceed in some cases the values I have mentioned. In consequence they do not qualify for the reduced duty, with the result that the flow of imports is restricted. I imagine that the House will agree that it is eminently desirable that no impediment should he placed in the way of the smooth working of the cartel agreement; but it may be argued that we should have made an Order raising these figures slightly or even appreciably, rather than removing them altogether. Had we done so, we should have found that instability of prices abroad would have made the fixing of new limits extremely difficult, and we might well have had to come to the House again after a very short period for a further revision of the Order. For that reason, the Import Duties Advisory Committee concluded that the best way to adjust this position was to remove the limits of value entirely. That is the recommendation which they made to the Treasury and to which this Order gives effect. This Order exempts from additional duty consignments of the goods mentioned in Order No. 3, to which I have referred, which exceed in value the 519 limits given in that schedule—subject, of course, to the necessary certificates of origin and quota. Order No. 6 which we are now discussing might be described as simply adjusting the position in Order No. 3, to the altered circumstances of to-day.
There is one further point which I feel bound to mention to the House. Just as the rise in prices has excluded certain products from the advantages of the lower rate of duty, so also the removal of the value limits which we are asking the House to authorise to-night will give the advantage of getting into this lower range to certain higher-quality products, for example; alloy and special steels which are not normally controlled by the Cartel or regarded as within the terms of the main agreement. There is some danger that if there were an importation of unlimited quantities of these higher quality products, certain people in this country might be injured, notably the Sheffield steel makers; and in order to cope with that possible danger, arrangements have been made with the countries concerned (that is, the Cartel countries and Sweden) to regulate the proportion of their quotas which shall be allocated to these higher quality products. We have further the assurance that the Import Duties Advisory Committee will keep the position under review and will be prepared to recommend further action to the House if it is necessary to safeguard the position of our own producers. I hope that in these circumstances the House will be prepared, without further ado, to approve this Order; but I shall of course do my best to answer any questions that hon. Members may wish to put.

§ Mr. A. V. Alexander
In view of the very long discussion which we had on this matter last March, I do not propose to detain the House by debating the amending Order which has just been explained by the right hon. and gallant Gentleman. I cannot refrain, however, from saying that whenever it suits the convenience of the Government to do so, they are prepared to repeat the old cry of their tariff predecessors that it is always the foreigner who pays the tax, but that when it becomes necessary, in the case of what the right hon. and gallant Gentleman called high quality products, to reduce the prices in this country of the taxed commodity, 520 then the only way of doing it, the Government say, is to take off the duty, which seems ex hypothesi to prove that we in this country have been the unfortunate people who have had the burden of paying the duty.
I hope that the right hon. and gallant Gentleman's statement that the Import Duties Advisory Committee will carefully watch the situation will mean that there will be no continuance of the disabilities upon any of the steel manufacturers in Sheffield. I am not quite clear from what he said as to whether there will still remain certain categories of manufactured steel and certain classes of steel outside the Cartel which will not now get the favourable terms of the removal of the duty. I am very troubled about this at this time when we want to re-open international trade throughout the World. I gather that there are some of the classes which are now outside the Cartel agreement and which do not get the reduction of 'duty, which will now get it. I think that that is all to the good. I should like to have an assurance, not only that the Advisory Committee is watching the position, but that the Government will try to improve and not choke international trade.

§ Mr. Holdsworth
I should like to ask for an assurance that in particular categories this will apply to non-Cartel countries. I think that we are on very dangerous ground when not only is there an arrangement between different countries who are carrying out this Cartel agreement, but—I think I detected in the right hon. Gentleman's speech—an acknowledgment that there is an arrangement between the different Cartel countries as to the quota which they should sell of different categories. It is getting to a fine art when not only can they agree as to the amounts of the total tonnage spread through all the categories, but get even to the point where they say that in certain circumstances they will limit certain categories. It shows what arrangements can be made and how fine the distinctions can be drawn under these Cartel arrangements. I should like to know whether these classes from the non-Cartel countries will enjoy the same rates of duty as those from the Cartel countries.

§ Captain Wallace
I should like to say most certainly that the non-Cartel 521 countries will be given a quota of these particular high-class goods, which will correspond to too per cent. of their 1934 imports, at the reduced duty. It is the policy of the Board of Trade—and of the federation—to see that the non-Cartel countries do get a fair deal.

§ Mr. Alexander
What of the other classes of steel?

§ Captain Wallace
High-class steel will get an increased quota.