HC Deb 14 November 1947 vol 444 cc727-33

Motion made, and Question proposed, "That the Clause stand part of the Bill."

Earl Winterton

I do not think this Clause ought to be passed, even on a Friday in a thin Committee, without calling attention to a matter of constitutional importance, of which we had no real explanation during Second Reading. I hope the hon. and learned Gentleman will be able to give some explanation today. It concerns what, on the face of it, would appear to be the extraordinary provision that though Burma will henceforth be an independent country, nevertheless, Imperial Preference is to be continued. I should like to make two observations on this matter. In the first place, I looked up the precedents, and I find that the only precedent for this Clause is to be found as long ago as 1842 under the old system of preference which was abolished, as the Committee will be aware, by Mr. Gladstone, when the United States enjoyed the Colonial Preference accorded to Colonial-grown tobacco until 1842. Since what may be described as the modern system of preference has been introduced, there has not been one single example of any country outside the Empire enjoying preference which is accorded to the Empire, and to the Colonies.

The first question which I wish to address to the learned Solicitor-General, and which I hope he will be in a position to answer, is: what steps have been taken to consult the Dominions, and those Crown Colonies which have Legislatures to which a measure of responsibility appertains, to find out whether they are in agreement with this astonishing breach in the practice and principle of Imperial Preference? Everyone knows the importance which is attached to Imperial Preference, not only on practical but on sentimental grounds. I should like to know whether there was any consultation with the Dominions and the Colonies.

I should like also to know the reason for this most extraordinary provision. I have here some figures, which no doubt the Minister will be able to correct if they are wrong. They are the latest figures available, because there have been none published on trade with Burma since 1938. Burma exports then consisted, in the main, of rice, oil and teak; they came to something like £25 million—which is a rough figure—of which she exported to this country £6¼ million, mainly rice, in respect of which there was a preference of 1⅔d. per lb., which I understand is the present preference. In the same year, Burma imported from the United Kingdom goods to the value of £3½ million, mainly in machinery, motor-cars and certain cotton goods. From that it would appear that, from the point of view of Imperial Preference, there was not very much advantage to us; that is to say, we were giving them preference on double the amount of our exports to them, so that in itself would not look as if there was any reason for continuing it. But this matter goes much further than that, and I want to know what is the explanation, and what are the intentions of the Government under the second part of Subsection (1), which reads: Provided that His Majesty may by Order in Council direct that, as from a specified date … Why has not the date been inserted? Why have the Government said, in effect, that it may be convenient to continue these preferences for the moment but not indefinitely, without any date being inserted? We on this side of the Committee attach some importance to this matter, and because of our interest in Imperial Preference I should be very glad to hear what is the reason for what seems, on the face of it, to be a most extraordinary Clause.

Mr. A. Henderson

The background of this situation is historical, and dates back to the year 1932 when, as the noble Lord knows, following the Ottawa Agreements, the Import Duties Act, 1932, was passed, which provided that Burman goods imported into the United Kingdom up to 31st March, 1948, were to be treated as Colonial goods; that is to say, they were to be free of Import Duties. After that date they were to be treated as Dominion goods, and entitled to such Imperial Preference as might be agreed in a trade agreement between the United Kingdom and Burma; failing a trade agreement they were then to pay full—that is foreign—rates of duty. The Isle of Man Customs Act, 1932—which is also referred to in the Schedule—is parallel to the Import Duties Act, 1932; and the Finance Act, 1933, in dealing with Customs, defined Burma as part of His Majesty's Dominions. The Isle of Man Customs Act, 1933, is, in this respect, parallel to the Finance Act of the same year.

The object of these provisions is to cover an interval of time between the passing of the Bill and the signing of a trade agreement between the United Kingdom and Burma. It has been contemplated for some years now that such an agreement should be arrived at, but there was delay in concluding an agreement between Burma and India, which prevented action being taken before the war. Since 1945 it has been considered necessary to await constitutional developments, and then the progress of discussions for the International Trade Organisation. As regards the Dominions, there is nothing in this Bill—nothing at all—which affects tariff arrangements between Burma and the Dominions.

Earl Winterton

That was not my point. I hope the right hon. and learned Gentleman will answer this. I want to know whether he has consulted the Dominions, and the Crown Colonies having semi-responsible Governments, and asked them whether they agree with this extraordinary provision of granting preference to a country outside the Empire for an indefinite time. He has now told us there is to be some limit. If so, why is it not put in the Clause?

Mr. Henderson

No steps have been taken to consult the Dominions. This is a matter between the United Kingdom Government and the Government of Burma. As I say, trade agreements between the Government of Burma and the Dominion Governments are not affected, but certainly in the ordinary way the practice has been followed as in bygone days of keeping the Governments of the Dominions informed. I am certainly not prepared to say that they have been consulted, thereby implying that they have been parties to the arrangement." They have certainly been informed.

As I say the object of these provisions is to bridge this interval of time. It is expected that a trade agreement will be made in the near future between the United Kingdom Government and the Government of Burma, and this is merely to maintain the status quo. I do not think there can be any objections, internationally speaking, to the fact that we are continuing tariff treatment to Burma after she leaves the Commonwealth, because, as the noble Lord knows, in the draft charter of the International Trade Organisation, Article 16 permits the continuance of such treatment between the United Kingdom Government and Burma; as also, indeed, between the United Kingdom Government and the rest of the Commonwealth, between France, Belgium and the Netherlands and their respective overseas territories, and between the United States of America and the Republics of Cuba and the Philippines.

1.30 p.m.

Earl Winterton

The right hon. and learned Gentleman has not begun to answer the point I put to him. He kept harping on the point that this does not directly affect the Dominions. I claim, however, that in view of the fact that Imperial Preference is sui generis—it has been said, again and again, that it is a preference in the true sense of the word—the Government had no right to enter into an arrangement of this kind without the fullest consultation with the Dominions and the Colonies. The action of His Majesty's Government will be most unfavourably commented upon in the Dominions. The whole point of Imperial Preference is that it is, as its name implies, a preference given to the Empire. I make so bold as to say that this point has not been properly considered by His Majesty's Government. I regret that no time limit has been placed in the Clause, and I must tell the right hon. and learned Gentleman that in the interests of Imperial Preference, in which we on this side strongly believe, we shall have to pursue this matter again and again unless this preference is abolished.

Mr. Bramall

I cannot see the ground for the noble Lord's chagrin against this concession unless it is that he is filled with a spirit of vindictiveness against Burma, and wants to punish that country for her sin in leaving the Empire, whatever we may think about the wisdom of her decision in that respect. It would be a bad basis for His Majesty's Government to legislate upon to say, "We will not maintain certain beneficial relations because you have taken certain political steps of which we do not altogether approve." The suggestion that this decision should be made conditional on agreement with the Dominions seems to me to be placing an entirely new gloss on Commonwealth relations. It is true that Governments consult with each other, and keep one another informed, but to suggest that this Parliament should be prevented from passing laws to regulate our trading relations with other countries, because we cannot get agreement with other countries in the Dominions, would be just as wrong as to suggest that one of these other Dominions should be placed under the same burden.

The noble Lord appeared to base his argument on the grounds that we were giving a preference where the benefit was more to Burma than to ourselves. The figures he quoted purported to show that exports from this country to Burma were twice the size of imports from Burma to this country. He admitted, however, that imports from Burma to this country were chiefly made up f rice. If our inability to purchase rice in the shops here is any indication I should imagine that that trade is absolutely negligible. On the other hand, Burma has an enormous amount of reconstruction to carry out; she has to bring herself up to date with machinery and modern equipment, and this will give her a reasonable chance of purchasing from this country. On any question of mutual benefit, I believe that the benefit of such an agreement—and I imagine that agreements which are reached will be on the basis of maintaining the same types of preference which exist between the two countries at the moment—would be entirely on our side. It would be cutting off one's nose to spite one's face if we were to do away with it. It is true that there is no precedent for it, but since the secession of the United States from the Empire, there has been no precedent for this matter at all. There are precedents in other parts of the world. For instance, the United States, who are in the same relationship to the Philippines as we are to Burma, have maintained their preferences with that country. This is a provision which is entirely to our advantage.

Earl Winterton

I wish to trouble the Committee again only because the hon. Gentleman the Member for Bexley (Mr. Bramall) accused me of vindictiveness. On the contrary, I want to see the fullest trading relations between this country and Burma. Of course, the hon. Member and Members opposite are not in the least interested in this; they do not care what happens to the Commonwealth, but it matters to some of us on this side of the Committee. It is a great mistake that a date has not been put into the Bill. I want to see the fullest trading arrangement with these people, but I do not want it to be called "Imperial Preference," because it is not. I am sorry that anyone should accuse me of vindictiveness, when all I asked for was a sensible trading arrangement. I am sorry that the hon. Gentleman has gone out of his way to denigrate Imperial Preference.

Mr. Bramall

Those Members of the Committee who listened to me more carefully than the noble Lord did will know that I said nothing to denigrate Imperial Preference, or to give any colour to the words used by the noble Lord in describing my remarks, most inaccurately, as indicating that I had no interest in the Commonwealth or that any other Member on this side had no interest in the Commonwealth. I think this Debate has shown more clearly than probably any other Debate on this subject how much clearer a conception of the real nature of the British Commonwealth is possessed by Members on this side of the Committee than by hon. Members opposite. We regard it as a voluntary association; the noble Lord and some of his hon. Friends appear to regard it as a penal institution.

The Temporary-Chairman (Mr. Diamond)

The hon. Member is getting rather wide of the Clause we are discussing.

Mr. Bramall

I bow to your Ruling, Mr. Diamond, but I am glad that I have been able to answer the equally wide remarks made by the noble Lord.

Clause ordered to stand part of the Bill.