HC Deb 18 March 1946 vol 420 cc1534-6
The President of the Board of Trade (Sir Stafford Cripps)

I will, with the permission of the House, make a statement on the future arrangements for the purchase of raw cotton. The Government have given careful and prolonged consideration to this matter and have now reached a decision. The question of centralised purchase of materials as a permanent peacetime measure has to be considered, case by case, in the light of the special circumstances, and cannot be decided upon any preconceived theoretical basis. In the case of cotton, the Government have reached the conclusion that centralised purchase is the best method by which this country can secure its requirements of raw cotton, and that such an arrangement will be in the best interests both of the nation and of the cotton industry. It is unlikely that postwar international conditions will in any event favour the operation of a cotton futures market of prewar type, and the Government are satisfied that centralised purchase, which has been operated successfully during the war, will in the future enable the supplies of cotton required by this country to be obtained at least as economically as by private importation and with greater certainty and regularity. It will also facilitate the maintenance of reasonable stability of price to the spinner and the operation of the measures of price stabilisationof utility cloth, which are an important element in the cost of living policy.

The Government have accordingly decided to continue the central purchase of cotton by the Cotton Control, in preparation for the establishment of a permanent cotton purchasing commission working in close contact with the spinning industry. The cover scheme now operated by the Control will be extended and will afford to the spinner the assurance of stable prices of cotton from the moment when he contracts to sell the yarn. It will also provide closer cover in respect of particular growths of cotton than was provided by the prewar futures market.

Mr. David Eccles

Is the President of the Board of Trade aware that expert opinion is very divided on this point, that many men who have spent their lives in dealing with cotton think we should get it cheaper if there was a futures market, and further, that this would earn more money for this country?

Sir S. Cripps

Yes, Sir. That is why the Government gave the matter long and careful consideration. They were aware that there was a great division of opinion and they have concluded that their decision now is the right one.

Mr. Eden

It is very gratifying to know that the Government have given the matter prolonged and careful consideration. The right hon. and learned Gentleman will not mind if we also give his statement a certain consideration and may have to ask for the opportunity to debate it.