§ Motion made, and Question proposed, "That this House do now adjourn."—[Mr. Bowden.]
§ 9.33 p.m.
§ Mr. Nabarro (Kidderminster)
I rise tonight with some diffidence to call the attention of the House to a number of the current problems in one of our smaller but most important industries, the carpet industry which, as hon. Members will know, is for the most part centred in the relatively small Worcestershire town of Kidderminster. I am glad to see in their places the hon. and gallant Member for Ayr (Sir T. Moore), the hon. and gallant Member for Renfrew, Eastern (Major G. Lloyd), and the hon. Member for Kilmarnock (Mr. Ross), who have smaller carpet interests in their respective constituencies. Something of the order of 37½ per cent. of the carpet industry is in Kidderminster, and the balance is to be found in various Yorkshire towns, and in Scotland.
Before I deal with the problems of the industry I would like to sketch a few of the facts forming its background. It has had a peculiar history during the past decade because it was one of the only industries in Britain which was completely shut down between 1940 and 1945, when carpet factories were switched over to small-arms and sundry engineering production in connection with the war effort.
The process of reconstruction from 1946 was thus a particularly difficult one. In 1946, the industry was one of the first in Britain to receive the attention of a working party. The working party consisted partly of trade unionists, partly of employers and of a number of independent persons. In giving a very brief summary of its findings, I cannot do better than quote a paragraph on page 13 in Section II, the "Technical Review." It says:Carpet manufacturing is a highly developed mass production industry. The factories in general are adequately equipped and managements are watchful about introducing improvements in the mechanical devices they employ.Since 1946 there has, of course, been a considerable technical advance.
I mentioned that the industry is a relatively small one. The number employed in it today throughout the whole country is only 28,700, compared with 1956 a pre-war figure of 32,000. This shows a decline in manpower of about 13½ per cent., but, notwithstanding that decline, there has been an overall increase in productivity since pre-war, and the industry is now turning out some 3 per cent. more carpets in square yardage than in 1939. The importance of the industry to the export trade cannot be over-emphasised. In 1949, Great Britain's carpet exports amounted to £10,300,000, in 1950 the figure rose to £15,200,000, and the published figures for the first two months of 1951 show an export out-turn of £3,267,000, indicating that the rate for the full year will reach nearly £20 million, or an increase of no less than 100 per cent. upon the figure for 1949.
It is not unfair to say that the carpet industry is a model for joint consultative organisation. It is one of the few industries in Britain which has a joint advisory council, made up of six trade unionists and six employers with an independent chairman, to deal with general problems, and a joint industrial council to deal with wages. Both the trade union side of the industry and the employers side are highly organised.
The principal concern, today, of the overwhelming majority of the men and women in the country is the inordinately high prices that carpets have reached. It is no exaggeration to say that the comfort and well-being of all our people are contributed to very largely by carpets in their homes. I hope to see, in the course of the next 10 or 15 years, carpets appearing in every new house erected in Great Britain. But today, when people learn that I am associated with Kidderminster, I hear complaints on all sides about the very high prices of carpets, and inquiries about what measures can be devised to bring them more within the reach of the ordinary wage earner.
It is difficult to compare pre-war prices with post-war prices in view of the number of variable factors which affect both. The easiest way to do is to relate wages earned pre-war and post-war to the price of a carpet. I can most easily do that by comparing how much, in terms of carpets, the wages of a carpet weaver would buy in 1939 and now. In 1939 the average male carpet weaver earned £5 a week for a standard working week.
§ Mr. Nabarro
The hon. Gentleman should know that there were no female carpet weavers earning that wage in the industry, in 1939.
§ Mr. Nabarro
The skilled male carpet weaver, earned, in 1939, £5 a week, and it was always boasted in pre-war days that his one week's wages would buy a 12 ft × 9 ft. Axminster A.2 carpet, which, in those days, cost, on an average, very slightly less than £5. Today, the carpet weaver earns approximately £8 10s. per week. The same carpet that cost £4 19s. in 1939 now costs no less than £24 16s., which represents three weeks' wages of a carpet weaver.
Perhaps I might usefully quote a statement made by the Secretary of the Carpet Weavers' Union, Mr. C. Yarsley, when recently, he attended and waited upon the Financial Secretary to the Treasury in connection with the incidence of Purchase Tax on carpets, for this illustrates my point about the very high prices that carpets have now reached. Mr. Yarsley stated that it appeared that the worker was condemned for all time to the use of linoleum or coconut matting. He considered that in relation to the better housing and other conditions which the worker now enjoyed he should not be debarred from buying a carpet because its price placed it beyond the reach of his pocket. He considered that a small industry such as the carpet industry was being asked to do too much by contributing such large sums to the Treasury by way of Purchase Tax.
Mr. Yarsley continued by stating that he knew the difficulty manufacturers were experiencing on the question of finance, and that employees were anxious in that any restriction of trade would lead directly to unemployment. In the case of Kidderminster there was no other industry that could absorb any redundancy of labour if unemployment were on any substantial scale.
That is the measure of the problem today and, of course, as the hon. Member for Rotherham (Mr. Jack Jones) has been interjecting impatiently for the past few moments, this difficulty arises very largely from the precipitous rise in the cost of raw materials during the last three years. The carpet industry is peculiar in this 1958 respect. Today, 80 per cent. of the cost of a carpet is made up of raw materials. [HON. MEMBERS: "Wool."] That means that a carpet has what the President of the Board of Trade referred to in his speech on the Budget as a low conversion value. Eighty per cent. is raw materials; only 20 per cent. is the cost of the labour and of the overheads and gross profit margin which go into the manufacture of the carpet. That is an extreme case of low conversion value in a manufactured commodity. At the other end of the scale, in the engineering industry, it is not unknown for a finished product to have only a 10 per cent. raw material content.
I stress this point because it means that whenever any substantial alteration in the price of wool or cotton or jute—the three constituent raw materials in a carpet—takes place, then the controlled carpet price arrangements of the Board of Trade are immediately thrown out of gear-Wool is now standing at 16 times the pre-war price. It is standing at approximately six times the 1947 price.
§ Mr. Nabarro
I could spend the next two hours arguing the merits and demerits of an international free market for wool, but the subject this evening is the problems of the carpet industry, which certainly spring from wool. I must say to the hon. Member for Rotherham, who is constantly interrupting me, that I have no desire to be controversial about this matter. So far I have only been stating the facts of the case, as can be readily checked by all the available statistics.
On 1st March, 1951, that is six weeks ago, the President of the Board of Trade remarked in reply to one of my Parliamentary Questions that wool was standing at five to six times the 1st January, 1947, price, jute was standing at 2⅓ times the 1st January, 1947, price, and cotton was standing at 3⅔ the 1st January, 1947, price. Those three constituents together—and in consideration of the fact that the cost of a carpet comprises 80 per cent. raw materials—mean that prices have been forced inordinately high.
There is no immediate remedy for this situation. I am not expecting the Parliamentary Secretary to the Board of Trade 1959 to be able to respond this evening with a solution to the problem. I am merely drawing attention to it and making a comment upon the hon. Gentleman's price control arrangements. There have been seven advances in the controlled price of carpets since 1st January, 1947. Every time a price advance has taken place, events have overtaken the new prices. The Parliamentary Secretary will recall, for instance, that the last price advance for carpets took place on 5th March, 1951. That price was based upon woollen yarn at 158d. per lb. By the time the carpet price increase had been promulgated it was found that carpet wool had risen to 200d. per lb., so that the negotiating—
§ Mr. Dryden Brook (Halifax) indicated dissent.
§ Mr. Brook
I have spent the whole of my life in the buying and selling of raw wool, including that for the carpet industry. I accept the hon. Member's figures as to the relative increase in the price of wool for the carpet industry, but carpet wools have not reached 200d. per lb., in general, up to now.
§ Mr. Nabarro
I am grateful to the hon. Member and will quote him the figures extracted from a carpet manufacturer's accounts in Kidderminster:January, 1948; Carpet Woollen Yarn 54d. per lb.1st July, 1950: 90d. per lb.1st January, 1951: 152d. per lb.1st February, 1951; 162d. per lb.1st March, 1951: 178d. per lb.31st March, 1951: 201d. per lb.
§ Mr. Brook rose—
§ Mr. Nabarro
Let me continue. I telephoned a member of the Wool Exchange this morning to ascertain the level of prices for carpet wool at yesterday's biddings in the market at Liverpool. Mercifully, prices have declined by approximately 20 per cent. during the last 10 to 14 days, and appear to be settling at this lower level.
I was dealing, when I was interrupted, with the question of the price control arrangements. My plea to the Parliamentary Secretary is simply that he 1960 should recognise that events always overtake the Board of Trade. The negotiations for new prices always appear to take too long. The Board of Trade plead that they must allow a certain period for stocks bought at the lower prices to be consumed, but, unfortunately, stocks are not by any means even in every firm in the industry; considerable hardship has been imposed on many firms whose stocks are exhausted and who have to replace those stocks at higher prices before the new carpet controlled prices come into effect. Thus, substantial losses are inevitably incurred.
A cost investigation of the whole industry is now proceeding. I hope that it may be completed at the earliest possible moment and that the whole machinery for settling controlled prices of carpets, whether up or down—I hope that the next new settlement will be down, in the interests of the consuming public—can be considerably speeded up.
I pass now to an entirely different field: the question of carpets that are imported into Britain. I will always be a keen supporter of the greatest possible measure of competitive enterprise, provided that circumstances, terms and conditions of competition are fair and equitable. I believe that, in the case of Indian imported carpets, however, the conditions are extremely unfair and inequitable, for two important reasons.
First, Indian carpets coming into the United Kingdom do so on an open general licence without a tariff, that is without payment of import duty, and the imports of these carpets and rugs from India have been increasing very considerably in the last few years, For instance, in the calendar year 1950 the volume of imports was £2,949,000. In January, 1951, the latest published figure of imports of Indian carpets and rugs was £457,000. That was in one month and in a full year, calculated pro rata, it would be no less than £5,484,000, an increase of 86 per cent. in the rate of imports for 1951 over 1950, and 1950 represented a rate of increase of 66 per cent. over the preceding year.
While Indian carpets and rugs come into the United Kingdom duty free British carpets going into India—and we have an interest in that market—are subject to an ad valorem import duty 1961 of 31¼ per cent., which includes a preferential tariff of 12½ per cent. under the most favoured nation clause. In other words, the normal import duty for carpets going into India is 43¾ per cent. from which is deducted the preferential tariff, reducing the percentage to 31¼ per cent. Moreover, the Pakistan imports are considerable into the United Kingdom and come in duty free. Our British carpets are now subject to an average import duty of 45 per cent. into Pakistan, the preferential tariff of 12½ per cent. having been removed by the Anglo-Pakistan Trade Agreement of 2nd April, 1951.
Therefore, there is a thoroughly inequitable tariff position. Why should we not have some reciprocity in this matter? My second plea to the Parliamentary Secretary—and I know it is a difficult problem—is to ask him to endeavour to commence administrative action and negotiations to secure that reciprocity. The position is doubly confounded, from the point of view of the British manufacturer, because not only has he these tariffs against him, but also the Indians have decided to put export duties on two of the essential raw materials which the British carpet manufacturer requires for his carpets. There is an export duty of 30 per cent. on East Indian wool and 30 per cent. to 35 per cent. on jute and jute yarn, all of which are bought in considerable quantities by the British carpet manufacturer; thereby twice confounded. I ask the Parliamentary Secretary to endeavour to help the British carpet manufacturer in this respect.
I should also make some passing reference to an aspect of the question which, I believe, Government Departments are losing sight of today. Any member of the consuming public may buy furniture, mattresses, or furnishing fabrics without paying Purchase Tax, but, in the case of carpets every one sold in the United Kingdom is subject to Purchase Tax at 33⅓ per cent., which immediately places carpets in the luxury group. As my trade union leader friend, Mr. Yarsley of the Carpet Weavers' Union in Kidderminster said, this is one of the potent factors in raising the price of carpets so high that they are beyond the purse and paying capacity of the ordinary middle and lower wage earners groups in Britain.
1962 I hope that none will deny that carpets are essential to the comfort and well-being of the community. I ask hon. Members to contemplate the harsh and bare conditions we would suffer in this Chamber if the architects had decided that we should have polished oak boarding for the floor. I have constantly deplored the fact that the products of the most famous carpet manufacturing town in the world, Kidderminster, are not represented in this Chamber and that the whole of the carpets in this Chamber were bought from a firm in Glasgow. There is undoubtedly a case for the reduction or elimination of Purchase Tax, and while I should be out of order in pursuing that point now I hope to return to it on the forthcoming Committee stage of the Finance Bill.
Hon. Members will know that we have succeeded in the last four years in sending to the U.S.A. many important productivity teams which have profitably examined American methods of manufacture. The carpet industry in America is, like ours, well organised. Its rate of production per man-year is certainly slightly higher than ours, due largely to the degree of standardisation and wide looms in America, and the fact that they do not concentrate on design, colour and quality to the same extent that we do in the United Kingdom. Productivity teams have gone to America representing the iron and steel industry, the hosiery and knitwear industry, the carton and box-making industry, the drop-forging industry and many others.
There appears to have been some resistance either on the part of the Anglo-American Productivity Council or from some unknown source to sending a productivity team for the carpet industry to the United States. I believe that the Parliamentary Secretary has some prior knowledge of this matter, and I should like him to tell me, if he can, when he replies, what is the impediment in this matter, and whether it is the policy of the Board of Trade to encourage the sending of such a productivity team to the United States.
I should like, briefly, to summarise the four commendations I make to the Parliamentary Secretary in connection with this industry. First, there should be a speeding up of the whole machinery for negotiating, within the price control structure, price revisions of the Board of Trade, 1963 whether up or down, if such price revisions become necessary in the future, and the cost investigation of the industry which is being conducted should be expedited and its findings published at the earliest possible moment. Second, there should be a measure of reciprocity as between Indian and British carpets and immediate negotiations with the Indians to try to persuade them to relinquish their iniquitous habit of placing an export tax on raw materials which come to this country when we do not see the same principle in respect of the export goods that we send to India. Third, there should be an investigation of the prospects of a productivity team going to the United States of America. Fourth, there should be a reduction or elimination of the iniquitous Purchase Tax on carpets.
§ 9.59 p.m.
§ Mr. Pryde (Midlothian and Peebles)
The English are said to have a very pretty opinion of themselves and the hon. Member for Kidderminster (Mr. Nabarro) is no exception. I am sorry to inform the hon. Member that some of his statements are not quite facts because facts are true, and that some of his statements were quite inaccurate. [HON. MEMBERS: "No."] Oh, yes. For example the hon. Member said that there were no skilled women weavers. Scotland is not unknown in the carpet weaving industry. Temple-ton's can hold its own with any unit in the industry. Stirling, Ayr, Dundee and Kilmarnock are not unknown, while in Midlothian we have two firms, Messrs. Henry Widnell and Stewart, and a subsidiary, Stewart Brothers, who are the only tapestry weavers in Scotland. My own sister was one of the skilled women weavers of Henry Widnell and Stewart—
§ It being Ten o'Clock, the Motion for the Adjournment of the House lapsed, without Question put.
§ Motion made, and Question proposed, "That this House do now adjourn."—[Mr. Sparks.]
§ Mr. Nabarro
I am very sorry if the hon. Member misunderstood me, or if I was guilty of slipping into error at that point. My point was that the wage I was quoting for 1939 was the wage of a narrow 1964 loom Axminster male weaver. I recognise, of course, that there are skilled female weavers within the industry.
§ Mr. Pryde
The hon. Member told us that at Kidderminster they were making £5 per week. I am sorry to say that in the town where I stay, and have stayed for over 50 years, the centre of the tapestry weaving industry, such high figures were never attained in the carpet weaving industry. In fact, my late lamented friend the Labour Member for Peebles and South Midlothian and myself had to go to the Ministry of Labour and get a labour exchange put in the town because there was so much unemployment in the weaving industry. In fact, 50s. was more like the average figure for skilled weavers in Eskbank, Bonnyrigg and Roslin. My next-door neighbour was complaining to me quite recently that she would be in a very bad position when her son went to put in his National Service. Hon. Members can judge when I tell them that she told me he was giving her £7 a week. Never before have such wages ruled in the carpet weaving industry in Scotland. Never before has there been such content.
The hon. Member for Kidderminster is correct when he says that the machinery in the industry is of a very high standard indeed. My late agent, Mr. John Keith, has contributed towards bringing the industry to that pitch. The hon. Member complained about the high price of raw material. Of course, raw materials have risen in price. Wool has risen 1,080 per cent. since 1938, but that is no fault of the present Government. It is no fault of the Government that the price of cotton has gone up. By bulk purchase we have proved that, had we not resorted to it, cotton prices would have risen out of all proportion. There is no use hon. Gentlemen complaining about India producing commodities cheaper than we do. It is true to say that the Indian worker can live at a lower standard than workers in the more temperate zones where we operate. The British financier was responsible for financing the industry in India, because he could get a higher rate of profit in India than from the British workers.
§ Mr. Pryde
The Indian worker is not complaining. He is trying to do the same as the British worker has done and build up his organisation in order to reach the same high standard of living as the British worker. Our people in Scotland know perfectly well the benefits which a Labour Government has conferred upon them, and I think that nowhere where weaving operations are carried on will they again resort to being represented by a Tory Member of Parliament.
§ 10.5 p.m.
§ Lieut.-Colonel Sir Thomas Moore (Ayr)
I must confess that every time I listen to my hon. Friend the Member for Kidderminster (Mr. Nabarro), I am more amazed than ever at his knowledge, his competence and his fluency. In fact, it makes it most embarrassing for anyone who has to follow him. That is also true for another definite reason—that there is simply nothing left to say. But, representing as I do one of the most distinguished carpet towns in Scotland, I propose to try to place before the House some of the difficulties from which the industry in Scotland is suffering. I suppose that, as far as this House is concerned, Ayrshire is only noted for its Members of Parliament—
§ Sir T. Moore
—but to the outside world I would suggest that our county is chiefly noted for its cows, its carpets and its furniture; although, as a matter of fact, Robert Burns claimed, in a fit of local patriotism, that our fame was based on the possession of honourable men and lovely women, or as he put it honest men and bonny lasses, and of course he was no bad judge. But as this debate is about the fascinating craft and great productive industry of carpet-making, I will limit my remarks to that subject.
Although my hon. Friend the Member for Kidderminster advanced many arguments in favour of the town he most efficiently represents, it may truly be said that Kidderminster is probably noted more for the quantity of carpets it produces, 1966 whereas we in Ayr like to think that the world looks to us for quality. I remember that when I was a very young soldier I was walking along the streets of Cape Town when suddenly I saw a most beautiful carpet in a window. I was so tickled at its attractiveness that I went into the shop to look at it. I found that on the back of it were the words, "Made by William C. Gray, of Ayr." That shows how far afield carpets from Ayr travel. Indeed, it may surprise the House to know that today half the world is carpeted by Britain, and the best half of it by Ayr.
§ Sir T. Moore
This industry is one of those quiet, happy industries, rarely, if ever, troubled by trade disputes, where proprietors, craftsmen and management all co-operate happily together. I suppose this is really due to the fact that carpet making is primarily a craft; and real craftsmanship always demands personal loyalty from the workers. That saves them from the day-to-day troubles of grasping for money, for a higher standard of wages or whatever it may be.
The problem with which we are faced is that, as I have already said, in addition to being a craft, it is a great productive industry, even greater than my hon. Friend appeared to represent it. It is constantly growing and constantly demanding more brains and fresh ingenuity in its development. As an example of the way in which this industry is developing, and can be still further developed, I would point out that the production of carpets for export amounted in 1938 to a value of £2 million only; but, as my hon. Friend pointed out, the export value today is something over £15 million so wide has the fame of British carpets spread. The demand is ever-increasing. In a few moments I will give the reason why the demand cannot be met.
In the last year there was, in addition, a home demand for 17 million individual carpets. That is a truly colossal figure. But, and unfortunately there is always a "but," this attractive, exciting, expanding industry, like every other industry, is faced with certain post-war difficulties. I do not say that they are all the fault of the Government, although undoubtedly many of them are. The 1967 trouble about the Government is that they only concern themselves with industries that cause trouble, except in the case of the one outstanding example, the steel industry, which is the exception that proves the rule. The Government are like the parents of naughty children; they are always fonder of the naughtier child. The Government have not yet realised—and perhaps the Parliamentary Secretary will explain why—what the carpet industry is fighting against, and, although my hon. Friend the Member for Kidderminster has specified almost every enemy which it has to face in every part of the world, there are certain points that need to be stressed.
First, practically all the main component parts of carpets have to be imported; that is to say, wool, cotton and jute. The result of that is—and we have seen it especially during the last few weeks and months—an increasing rise, even at times a fantastic rise, in prices, which makes it almost impossible for potential purchasers to contemplate the buying of carpets.
My hon. Friend stressed the fact that many of our young people are hopefully looking forward to getting married and setting up homes of their own, if they can get houses, and one of the best and first things which they would seek is a carpet. Linoleum is cold and expensive, and carpet is warm, but unfortunately still more expensive. As long as there are these difficulties and this fantastic Purchase Tax, which adds still more to the cost to the housewife, so long will the carpet manufacturer himself be in trouble. The Government have failed entirely in their new proposals to provide sufficient restoration allowances for new plant and machinery which is, as the House must know, constantly changing and improving in the industry.
Lastly, there is this competition from India, which comes from carpets made by people suffering from even less food and a much lower standard of life than we have here today, and also from a ridiculous scale of wages unrelated to any trade union system. What is to be done about that? A working party which might go to the United States and India would be useful, and it might try to arrange, first of all, reciprocity with India, 1968 and secondly, advance the fine quality of our manufactures in America.
All this would help, but, if this growing industry and this ancient and honourable craft is to be saved and be developed in the way it should be as a very valuable British industry, both for export sales and home consumption as well, the Government have got to do something about it. It is their responsibility; the carpet manufacturers are doing their best in trying to renovate their machinery and introduce new methods and the craftsmen in the industry are also doing their best. [Interruption.] I will take the hon. Member for Stirling and Falkirk Burghs (Mr. M. MacPherson) round one of the best carpet works in Ayr and show him the developments that are taking place. He will be amazed at the ingenuity displayed by management and workers alike which can be seen there. However, it is the Government's responsibility, and they must act. We want to hear what they propose to do.
§ 10.15 p.m.
§ Mr. Dryden Brook (Halifax)
Unlike the other hon. Members who have taken part in this debate, I have had a close connection with the carpet industry for the last 50 years. My firm is at present engaged in selling raw wool to the carpet industry, so it will be seen that I have some knowledge of the subject. The hon. Member for Kidderminster (Mr. Nabarro), who opened the debate, based his comparison as to cost on Axminster carpets. I want to repeat what I have already said, that the wools used in Axminster carpet have not yet reached 200d. per lb.
§ Mr. Brook
I should like to question one or two of the hon. Member's illustrations. When he was talking about the employment in the industry before and after the war, did he take into account the under-employment that existed before the war and the full employment which exists now? Obviously, there would be a good deal of short-time in pre-war days as compared with now. I know that in the first week of the last 1969 Summer Recess we sold carpet wool in the raw state at from 54d. to 60d. a lb. The highest price we have made for similar wool since that time has been in the region of just over 180d. a lb.
The hon. Gentleman also referred to the time lag between the rise in the value of raw wool and the Government control of prices. Three weeks ago, a Prayer was moved in this House for the annulment of an Order which had been made to help the interests of the carpet industry regarding prices. On that night I listened and looked very carefully for the hon. Member for Kidderminster, but he was not present. I hoped to hear his voice raised in protest—[An HON. MEMBER: "He was wool gathering."]—against that Prayer. As I say, I listened very carefully for a contribution from the hon. Member, because, as a rule, one does not have to wait very long before hearing his resonant voice. If there was ever an occasion when an hon. Member who was interested in an industry should have been in his place and spoken for that industry, it was that night.
There is another point on which I wish to question him. He claimed that the best carpets in the world were made at Kidderminster. I think it will be universally agreed that the best carpets in the world are still made in Halifax.
§ 10.18 p.m.
§ The Parliamentary Secretary to the Board of Trade (Mr. Rhodes)
Everybody seems to have been blowing his own trumpet or the trumpet of the particular section of the industry which happens to be where he lives. Perhaps for a few brief seconds I might be allowed to stake a claim in this industry, because it is just 128 years ago that a progenitor of mine, who was a contemporary of Harvey, O'Connor and Fielding, the Chartists of the day, started a hand-loom weavers' union in my district. Fortunately, we still have his account books, and are able to see that in those early days very considerable subscriptions were sent to the Kidderminster weavers. I hope that the good relations that existed then have had something to do with the good relations that exist today.
The hon. Member for Kidderminster (Mr. Nabarro) mentioned the high prices paid for wool. I think his contentions have been adequately answered by my hon. Friend the Member for Halifax (Mr. Brook), and I will proceed straight away 1970 to the question he raised about slowness in investigation. If the hon. Member was complaining of the speed at the time when costs were rising, that means that what he was really asking the Board of Trade to do was to impose a further increase on the price of carpets.
As he knows, a cost investigation is being held at the moment. A great many of the returns have come in and we expect to receive a report from our accountants on these returns not later than the middle of next month. How long it will take to get the order out depends upon the speed of the negotiations between the trade and us. I hope they will not be protracted. I should like to point out to the hon. Gentleman that it is not possible to make an investigation of this description in a few days or even in a few weeks. Accounts have to be prepared properly by the industry and examined properly by the Board of Trade accountants before we can arrive at a decision.
As to the general need for a price or cost investigation, I think that in view of the high profits made recently in the carpet industry—and the hon. Member for Kidderminster never mentioned this aspect in his consideration of prices—it was only reasonable, and in fact the duty, of the Board of Trade to hold a costs investigation before granting any further price increases. After all, the Board of Trade are the custodians of the consumer as well as the body responsible for the well-being of industry in this country.
To illustrate this, may I say that the profits recently published by four large firms in the carpet industry show an average increase of some 40 per cent. on their 1950 trading over their 1949 trading, while one company's profits show an increase of 92 per cent. Surely we are entitled to say that we must have a cost investigation before any further price increases are made. The hon. Member for Kidderminster mentioned Dominion imports and reciprocity. I agree that in the latter half of 1950 they were increased considerably. Imports from India and Pakistan went up after the introduction of the open general licence list. I have no doubt that that had an influence on the position.
But I must remind the hon. Member for Kidderminster that carpets imported from India represented 6 per cent. only of the total supplies to the home market 1971 in this country in 1950. On the other hand, United Kingdom exports to India have never constituted a large trade. In 1938–39 Indian figures of imports of British carpets amounted in value to no more than £22,500, which in those days was 10 per cent. of India's total imports.
As to tariffs, I am sure if he considers it at all, the hon. Gentleman will agree that it is totally impossible to arrange for complete reciprocity of treatment between a product in one country and a similar product in another. It would be quite impossible to arrange it so that there was an equality, a quid pro quo; and when the Government are negotiating a trade agreement they have to think of trade as a whole. They cannot think of the carpet industry in isolation. The agreement with India is very valuable for both countries and it would be hardly right to upset that agreement now just to protect the United Kingdom industry which is doing very well—it has many orders and there is little stock—against Indian carpets. The hon. Member is quite correct in pointing out that the 12½ per cent. preference which we enjoy is not enjoyed by any other foreign country exporting into India. Turning to Pakistan, there will be an opportunity of discussing this matter on the Finance Bill towards the end of May, when provisions relating to it are to be introduced.
§ Mr. Garner-Evans (Denbigh) rose—
§ Mr. Rhodes
I cannot give way. The hon. Member next raised the point of a productivity team going to America. As he knows, this is the job of the Anglo-American Productivity Council; it is not our job. We cannot tell them what to do, but I will say this to the hon. Member: I will bring the points he made 1972 to the notice of the Council. I cannot do any more; I cannot direct. With regard to Purchase Tax, I am afraid this is a field into which I cannot enter, nor do I intend to enter it.
I am greatly obliged to the hon. Gentleman for having raised this topic, because this is a good industry. I visited the firm in Ayrshire to which the hon. and gallant Member for Ayr (Sir T. Moore) referred; they were first-class, and they impressed me by the way in which they set about the job of starting the machinery and getting on with the war effort when that was demanded of them. Not only that, but I have been impressed by the way in which they have picked up since and put into their factories the broader looms so that we can sell our goods to the dollar markets.
The debate has given me the opportunity to say how grateful I am, personally, for a recent example of co-operation with the Federation of British Carpet Manufacturers. I saw their representatives personally when they came up here about the last price increases and I asked them to withdraw their rule requiring their members to sell at prices ruling on the day of delivery. I also had reason to ask their members to give an undertaking not to hold up supplies for higher prices at times when price increases were pending. I am grateful to the Federation for the statesmanlike way in which they acted, because almost at once they asked their members to accede to these requests and, as far as I know, they have been carried out loyally by the Federation.
§ Adjourned accordingly at Twenty-eight Minutes past Ten o'Clock.