HC Deb 13 July 1956 vol 556 cc806-24

Motion made, and Question proposed, That this House do now adjourn.—[Mr. Barber.]

2.42 p.m.

Mr. John Tilney (Liverpool, Wavertree)

Although throughout today we have been debating the Third Reading of the Finance Bill and various arithmetical calculations of the chances of a top Surtax payer drawing a Premium Bond, I hope that the House will forgive me if I quote some figures to support my contention that the Commonwealth wine producer is not receiving a fair deal.

The figures that I quote are in gallons of heavy wine in bulk in cask. They show that in 1938–39 we consumed in this country no fewer than 2,860,000 gallons from Australia, whereas in the year 1954–55 that figure had dropped to a mere 265,000 gallons, or less than one-tenth of the pre-war figure. I agree that there has been an increase in the consumption of light wine from Australia, but that is really negligible compared with this massive drop. The drop from pre-war in imports from Cyprus has been as much as 50 per cent., whereas the figure for Spain has been maintained and those for France, Italy and Germany have been increased.

In 1925, the then Conservative Government made an economic decision to encourage the production of wine in the Commonwealth. That decision was fortified by action in the 1928 Budget, and particularly at Ottawa in 1932. So much so that between 1932 and 1938 the consumption of Commonwealth wine rose from 4 million gallons a year to 5½ million gallons. What exactly happened at Ottawa? Duties were stabilised then and foreign light wine paid 4s. a gallon, whereas Commonwealth light wine paid only 2s. Commonwealth heavy wine paid 4s. a gallon and foreign heavy wine 8s. There was, therefore, a 50 per cent. preference differential between the foreign and the Commonwealth wine but, due to increases in duty during the war and the halving of light wine duty by Sir Stafford Cripps in 1949, that differential was reduced from 50 per cent. for both types of wine to 20 per cent. for the heavy and 15½ per cent. for the light. And, of course, the fall in the value of money, which has really been shown by the increase in the price of wine, makes that preference differential even less important, because the duty is not on an ad valorem basis.

Therefore, the situation now is that whereas foreign light wine comes in paying only 13s., Commonwealth heavy pays as high a duty as 40s., whereas at Ottawa they were both equal. It is rather odd to recollect that in 1949 the late Sir Stafford Cripps thought that he was taking action to encourage the consumption of Commonwealth wine. Yet, what has happened? The import of light wine from Spain has gone up from 22,000 gallons to 488,000, and from Italy from 6,000 gallons to 462,000, from Germany from 35,000 to 325,000 and from France from 554,000 to as much as 2,314,000 gallons. Admittedly, there has been an increase in the production of light British wine, but when light and heavy are taken together the consumption of British wine is less today than it was before the war.

The import of this foreign light wine is due, it has been suggested, to the need to blend in order to get round some of our Customs duties, or at least the full impact of them. I think that the House should know of the difficulties of the Commonwealth wine producers and of the extra expense that they incur in sending their light wines through a long tropical voyage. It may be said that Commonwealth wine producers have not sufficiently considered British tastes, but South Africa, where there are no fewer than 5,000 wine farmers in Cape Province and where, since Ottawa, many millions of pounds of capital have been invested in the production of wine, has, since 1949, in order to maintain the British market, changed over from her Port type wine to sherries, which are now reasonably popular in the British market. In passing, I should like to express regret that some of our Commonwealth wine producers use the nomenclature of Europe and not their own, although South Africa does, in certain cases, use the names of her local towns and villages.

I have here the shipping figures of some South African vermouth, no less than 25,000 odd gallons, representing 150,000 bottles, which was imported into this country just before the late Sir Stafford Cripps made an alteration in the Light Wines Duty. That vermouth from South Africa was kept here for quite a number of years, and eventually had to be sent back. The managing director of the South African Wine Farmers' Association, in a letter dated 4th August, 1955, addressed to the Controller of the Statistical Office of H.M. Customs and Excise, said: The reason for its unsaleability is the fantastic deviation in the structure of the wine duties from those prevailing in 1939 to those at the present time. … We cannot possibly compete in this country with similar wines from foreign sources at the present rate of duties.

Mr. Speaker

It seems to me that the hon. Member is running into difficulties here. If the remedy for the complaint which he is making to the House is an alteration in the Customs Duties, that must be done, of course, by legislation, and it would be out of order to discuss that on the Motion for the Adjournment.

Mr. Tilney

With respect, Mr. Speaker, I wanted to state what had happened in the past and what some people think, although I am hoping to suggest that a statement by my right hon. Friend the Minister of State at the Board of Trade that he has the interests of Commonwealth producers at heart would have a big effect on the atmosphere of inter-Commonwealth trade.

Mr. Speaker

I am still a little uneasy, because I do not see how, if the right hon. Gentleman made such a statement, he could implement it except by some change in the Customs Duties, and to do that would involve legislation. If the right hon. Gentleman did make a statement of that sort, I think he would be talking about legislation, and therefore equally out of order.

Mr. Tilney

I am hoping that possibly by administrative action help can be given to Commonwealth wine producers, and that there would be no need for any legislation to be discussed. I hope I shall be in order in pointing out that, because action was taken, the Revenue benefited very considerably, but to the detriment of the balance of payments, whereas if something can be done to stimulate the consumption of Commonwealth wines, the balance of payments will indeed benefit.

There is a big new television audience, which I believe to be ripe for possible exploitation of the Commonwealth wine market, if only Commonwealth wines can be produced at the right prices. This is what Australia has been trying to do, though not very successfully. Australia has expanded her production in a big way, and is hoping that Great Britain will find a market for that production. Here I wish to quote from the Australian Wine Board's Report for 1954–55, in reference to the Commonwealth Prime Ministers' Conference—not the last meeting, of course, but the one before: During the Commonwealth Prime Ministers' Meeting in London, our Prime Minister discussed the question with the Chancellor of the Exchequer. It was also raised by our Minister for Commerce and Agriculture prior to the G.A.T.T. conference at Geneva … Although we feel very badly done by in that the duty on Commonwealth wines is now ten times the pre-war figure … it seems more apparent that its significance is only of minor importance to the Treasury. I am hoping that some action can be taken, either through some volume agreement or in some other way, to help our friends in the Commonwealth, because the cost to our trade of this drop of 2½ million gallons is as much as £1½ million, and yet at the present time the Government of Australia are cutting down our imports because they have not got sufficient sterling.

May I turn for a moment to deal with Cyprus, where the 2s. preference is taken up in extra freight charges, and where no less than 150,000 Cypriots are engaged in the wine trade? May I quote a letter which I received only yesterday about the position in Cyprus? In order to help the producers, the Cyprus Government has for the last four years or so put forward a scheme whereby we are buying all the Zivania, which is more or less what you might call the impure distillate, and this is done in order to help the growers to sell their vine products and earn a living. It will not be an exaggeration if I tell you that today the Government has invested over £1½ million in the purchase of this distillate. Furthermore, with a view to helping the vine growers, the Government is now purchasing from them raisins which they are forced to make because they cannot sell all their grapes for wine making. Is it not possible that in this case the colonial waiver, which has been used for products in the West Indies, could be used? May I also quote from an article in The Times from the Australian Prime Minister? I believe that the time has come when, in the British Commonwealth, we must give ourselves furiously to think about where we are going and what road or roads we should take. Unless we are conscious of our mutual problems and constantly working on them, we will, as they emerge, have little more to contribute to their solution than a vague and wistful sentiment. I only hope that our wish to develop Commonwealth trade can in some way be buttressed by economic action. The Commonwealth Producer, which is the organ of the British Commonwealth Producers' Organisation, in the May—June issue of this year, in an article about Commonwealth wines, concludes: Do Her Majesty's Government intend deliberately to go on denying a proper share of the home market to the wines of Commonwealth producers? I hope that my right hon. Friend can assure our friends in the Commonwealth that the free trade policy which some people think now dominates certain regions of Whitehall will give place to consideration for Commonwealth products in all future discussions on the trade.

2.59 p.m.

Mr. J. Grimond (Orkney and Shetland)

I am delighted to hear that a free trade policy dominates certain parts of Whitehall, but I have no desire to sabotage this Adjournment debate, which has been initiated by the hon. Member for Wavertree (Mr. Tilney), or to argue with him about his most admirable speech. There are certain drawbacks about starting one's Adjournment early in the afternoon, but perhaps I may say a word or two about it.

Ottawa Agreements have a more or less unhappy ring for my party, which is, after all, a free trade party, and I make no bones about the fact that to me, in general, free trade is a sound doctrine and really essential for a large trading country such as Britain. I should be very sorry myself if we were to create any unnecessary difficulties for countries like Portugal, which is our oldest ally, or Spain or France or Europe and trade in general.

Having said that, I also feel that free trade is one among many desirable objects. But if it is true that to deviate from the pure milk of the doctrine of free trade would help the Commonwealth I regard that as desirable. Luckily, Mr. Speaker, owing to your admirable guidance, I am precluded from arguing the course of action to be taken about the import duty, but I feel the least we might do is to encourage by example.

In this House there are frequent entertainments of overseas visitors and visitors from the Commonwealth. I have attended some of them in the company of the hon. Member for Wavertree and I have never been offered Empire wine. I may have been unlucky, but in my experience one is always offered excellent French or German wines. I doubt whether there is a great deal of Empire wine offered by the Government Hospitality Fund. I am not saying for a moment that all our overseas visitors should be offered Empire wines. There are those who think that the French and German wines may be better, but I am not sure there is not a great deal of snobbery about this. Some Australian wine which I have drunk is quite excellent. I do not know how well the best of our Empire wines travel, but some of them, including South African sherries, are extremely good.

Are they offered by other authorities, such as local authorities and the City, where banquets are held? The hon. Member for Wavertree and the Minister attend these banquets frequently, so no doubt they can tell us. I think that the general public should be better educated in this matter. There is in this House a drink called a carafe of wine. I am not an expert on wine, nor, I hope a heavy drinker, but I take a carafe of wine which, I understand, is French. I do not say that it is bad; it is moderately good, but I am sure that we could find an Australian wine which is just as good.

Outside this House one is frequently offered a drink which resembles not so much red ink as blue ink, and which, I suspect, is Algerian wine. I see no reason why a greater measure of propaganda should not be put about to encourage the drinking of Empire wine. Not only would that have the great advantage of doing what the hon. Member for Wavertree wishes to do and save my free trade beliefs, but it would also be keeping within the rules of the House.

3.3 p.m.

Major H. Legge-Bourke (Isle of Ely)

I should like to join in argument with the hon. Member for Orkney and Shetland (Mr. Grimond) about free trade and protection, but I am not sure how far that would be in order and I imagine that I should be out of order in doing so.

Mr. Speaker

That would be out of order, because to restore free trade, as I understand, would involve a great deal of legislation.

Major Legge-Bourke

That being my presupposition, I will not refer to it further, beyond saying that at the moment it seems to me we have a strange mixture of the two. Whereas, on the one hand, we have an element of protection in the old Ottawa Agreements, which cannot be altered as a result of our having signed G.A.T.T., on the other we have an element of free trade in which, as a result of G.A.T.T., we are denied the right to discriminate. But, obviously, this is not the time to argue that matter.

I am interested in the subject particularly in view of what was said by my hon. Friend the Member for Wavertree (Mr. Tilney). During the war, I was stationed in Cyprus and I remember very well some of the wines that were available there. I do not think that my hon. Friend was correct when he referred to the growers having to make raisins of their grapes instead of making wines. I remember visiting South Africa, in 1938, and having an excellent wine made from raisins. It does not follow that if a grower has to make raisins of his grapes, those raisins cannot be used for making wine. I believe that the difficulty is that raisin wine does not travel very well. Therefore, it probably has to be consumed in the country of origin. That is one of the reasons why this country has not had the advantage of the delicious raisin wine produced in the Union of South Africa.

We all sympathise with the view put forward by my hon. Friend. He desires that more people should be made aware of the excellence of some of the Commonwealth and Empire wines. I humbly endorse what the hon. Member for Orkney and Shetland said about Algerian wine. I seem to remember in the 1945–50 Parliament some of us who were then in Opposition having a rather gleeful debate with the late Sir Stafford Cripps upon the iniquities of importing Algerian wine of the quality then coming in in considerable quantities.

It is rather a pity that consumers in this country should be encouraged by publicans and others to drink Algerian wine when, all the time, there is available Commonwealth wine of a very much superior quality and at a highly competitive price. This is largely due to the fact that there is supposed to be something with which the French are associated which automatically makes any wine coming from such country better than any wine from elsewhere, and that leads to the supposition that Commonwealth wine is inferior.

I take the view that, as in all other things, one must discriminate in this matter. Certainly, it is as ludicrous to say that all Empire wines are delicious as it is to say that all wines emanating from countries associated with France are disgusting. I would say that, on the whole, it will be found that there are just as many Empire wines of high quality as there are wines of equal quality from other countries.

My hon. Friend has done a useful service today if only in drawing public attention to the fact that there are some excellent Commonwealth and Empire wines the consumption of which might well be encouraged in this country to a far greater extent.

3.8 p.m.

Mr. Bernard Braine (Essex, South-East)

I should like to congratulate my hon. Friend the Member for Wavertree (Mr. Tilney) on his good fortune in persuading you, Mr. Speaker, to allow this subject to be discussed. It is a great pity that subjects which touch so closely upon the mutual trading interests of Commonwealth countries and ourselves have to be discussed in Adjournment debates like this, at the end of a heavy day or on a Friday afternoon.

This matter is one which is close to the heart of many hon. Members and we should have liked to have a wider and longer discussion. I must declare a dual interest. First, like all hon. Members, I have a keen interest in expanding Commonwealth trade at every possible opportunity. In fact, I would go a long way towards discriminating in favour of Commonwealth trade, because such trade is a means of helping to bind together the constituent parts of our wide family of nations.

I must also declare an interest in that I like wine. I do not think that those two interests are incompatible. There may well have been a time when Empire wines could not even pretend to compete with the better quality Continental wines. We have had to deal with much prejudice. Many people will not consume Empire wine because, instinctively, they feel that it is inferior. Yet the most extraordinary improvement has taken place in the production of Empire wine in the last year or two. I had some Australian sweet sherry the other night which was quite distinctive in flavour and extraordinarily good in quality and the most astonishing feature was the low price at which it was retailed.

Mr. Stephen McAdden (Southend, East)

I am very interested in this subject and I appreciate what my hon. Friend says about the importance of trying to get people to accept this point of view. He said that our hearts are in this matter, but I wonder whether our palates are in it as well. From his researches, could he tell us how much Empire wine is consumed by hon. Members and whether they are always asking for Empire wine?

Mr. Braine

I am most grateful to my hon. Friend, who has a great capacity for asking penetrating questions. I must confess that my researches have not been so extensive as I should like them to have been because my public duties make it essential that I should arrive here in a sober state. People outside have no monopoly of prejudice; I have encountered many hon. Members on both sides of the House who have dismissed the idea of Empire wines without having ever studied the subject in any detail.

Mr. Speaker

I must remind the House that there is another point about debates on the Adjournment which ought to be borne in mind. There must be some Ministerial responsibility for the matter which is being discussed. In these learned and interesting discussions about the taste of wine, and so on, the Board of Trade is not involved in any way, nor is any Department of the Government. Hon. Members must relate their speeches to some sort of Ministerial or administrative responsibility.

Mr. Braine

I accept your very proper Ruling, Mr. Speaker, but I was distracted somewhat by the most penetrating and, as I thought, relevant question of my hon. Friend the Member for Southend, East (Mr. McAdden). Nevertheless, I should have thought that the Board of Trade had a direct interest in promoting the flow of trade between Commonwealth countries and our own. I should have thought, too, that at a later stage my right hon. Friend would say that an experiment might well be tried by the Kitchen Committee. With my hon. Friend, I hope that such an experiment might be tried at a very early date.

In Australia, a large number of people engaged in the production of wine—exService men who settled in the wine growing districts after the First World War and again after the Second World War—find it very difficult to understand why this country has imposed such heavy and, indeed, vicious duties.

Mr. Speaker

That matter is related to Customs duties and would involve legislation. It cannot be discussed on the Adjournment.

Mr. Braine

I am well aware that if I went on to suggest a course of action which would require legislation I should indeed be out of order, Sir. The sole purpose of my intervention, is as it were, to have some effect on the state of mind of the Minister.

I should have thought that it was a matter of very great concern that it is found difficult for good quality Empire wines to establish the market in this country which their quality warrants for reasons which may be due to legislation, or to other causes, but which, I hope, my right hon. Friend will explore. There may be some way round the difficulty which I feel sure, having heard the arguments, my right hon. Friend would seek to find.

I will leave it at that and end by saying that it is a matter of very great regret to hon. Members, particularly those on this side of the House, that for a fine quality and improving quality Empire product it is found exceedingly difficult to secure a proper market in this country because of the inability of successive Administrations to create the conditions which would make that possible.

3.15 p.m.

Mr. Charles Doughty (Surrey, East)

I do not intend to detain the House for long, but I want to make one or two references to what has been said in the debate, because I believe that everybody here is anxious to promote the sales of the products of our Commonwealth and Empire, whether they be wines or any other commodities. I am not quite in agreement with my hon. and gallant Friend the Member for the Isle of Ely (Major Legge-Bourke) when he says that all wines that come from France must be wonderful.

Major Legge-Bourke

I did not say that.

Mr. Doughty

My hon. and gallant Friend said something like that. Even in France barricades were erected because no one would buy their wines. I would not ask the Board of Trade or any other Department to encourage such action in this country or the Empire.

Because I believe the Board of Trade can encourage the sale of Empire wines, I am happy to add my few words to the debate. There are one or two matters in which the Board of Trade can assist both this country and the Commonwealth; its assistance is required in two matters in particular. The first is the need to encourage advertisement and publicity so that people here know what to ask for; and, secondly, the Board of Trade needs to help the Commonwealth and Empire in obtaining knowledge of what this country wants.

Although we talk glibly about strong wines and weak wines—whatever may be the dutiable expression—these are things which we have to consume, and this country has its own tastes and prejudices which are not always met by all the wines which come from the Commonwealth and Empire. It is no good sending hogsheads of wine over here which are not of the quality, the strength or taste which our people want. I am sure that the Board of Trade has that information and could easily circularise it to those who are producing the wine or shipping it from the Commonwealth. It is no good sending wine here and then saying, "I cannot sell it," when the reason is that it is not the type or strength or taste which is wanted, especially when so many wines are produced which are wanted. The Board of Trade can well assist there.

I believe that it could assist the Empire shippers, when they ship their wine here, in another way. The Board of Trade can assist because it has many treaties concerning the names of wines. What is the good of sending a wine from a distant part of South Africa or Australia and calling it by the name of a village on the Rhine or a district of France? It starts with a disadvantage. It may well be that it will take a little time, education, publicity and advertisement to get the names known among wine consumers in this country, including hon. Members, but my right hon. Friend the Minister of State, Board of Trade, who is to reply to the debate, could also circularise hon. Members and tell us what is likely to be on our wine list.

We cannot sell something by giving it a name that does not belong to it. That was tried with port, but because of the Anglo-Portuguese Treaty it was stopped and new shifts have to be resorted to, such as calling it port type and port strength. We are told that … a rose by any other name would smell as sweet. and I am sure that an Australian wine, once it was tried and known, would taste just as sweet under its own name as if it were given a French or other name.

The Board of Trade can help both the wine-producing countries and this country by giving the necessary encouragement and publicity so that this wine can be sold in competition, as it is, with wines that have a longer tradition in this country of sale, service and quality.

3.20 p.m.

Mr. Stephen McAdden (Southend, East)

Before you took the Chair, Mr. Speaker, some difficulty arose about Ministerial responsibility, and many arguments which might have been advanced in connection with this Adjournment debate have had to be dropped because they did not come within the sphere of such responsibility. I am a little handicapped in this respect because I do not want to be out of order in a similar way.

My right hon. Friend the Minister of State, Board of Trade, will agree that in the course of its duties his Department has the responsibility of entertaining large numbers of visitors, trade delegations and the like and that when that happens the choice of wines becomes the duty of his Department and the responsibility of himself and his right hon. Friend. I should like to have an assurance from him that, in the course of the many cocktail parties which it is the duty of his Ministry to arrange for delegations, Empire wines only will be served, and that, for example, there will be served sherry from South Africa instead of that from other parts of the world.

I remember, as I am sure do other hon. Members, a most successful Coronation luncheon in Westminster Hall, when all the wines served were from the Commonwealth and were greatly enjoyed by Members of the House and by many visitors from overseas. I am sure that it would be very useful if, at the various State functions held under the responsibility of his own Department, the Minister would see that only Empire wines were served. I know that it is not the general practice and that in one part of the world difficulties arose because Armenian brandy was served instead of Russian vodka. I think that we should stick to our own wines, which we thoroughly understand, and I hope that my right hon. Friend will use his great influence to see that when his Department entertains visitors from overseas they are regaled exclusively with Empire wines and that thereby their health is assured and accord is promoted.

3.22 p.m.

The Minister of State, Board of Trade (Mr. A. R. W. Low)

This has been an interesting but somewhat difficult debate. I should like to congratulate my hon. Friends and the hon. Member for Orkney and Shetland (Mr. Grimond) for the skill they have shown in keeping just within the rules of order. I am in some difficulty because, as I have to answer the case put against me, it becomes rather more obvious rather more quickly that I am getting near to being out of order. I shall not, therefore, be able to comment on some of the matters that have been raised.

I should like to congratulate my hon. Friend the Member for Wavertree (Mr. Tilney) on the great knowledge he has shown in this important matter. I very much welcome the interest which he and the House have shown in the position of the Commonwealth wine producers. I, like other hon. Members, have two interests. First of all, I share their interests from the national and the Commonwealth point of view, and share it more particularly as a Member of the Government. I share it also as a consumer of some of the Commonwealth wines, which I know well.

I had assumed that my hon. Friend's object was to draw attention to the present position and, if I may say so, he has done it very well. I assume that he cannot want to do more than that because, as has been pointed out, if he seeks to alter the present position, I must deploy the argument that an alteration of the Wine Duties, which are Revenue Duties, can be altered only by legislation. I would say that in fact there is no other field in which the Government properly have responsibility in this matter.

The Government are not, for example, wine tasters. We have no responsibility for helping in the selling and advertising of Commonwealth wines, a suggestion made by my hon. and learned Friend the Member for Surrey, East (Mr. Doughty). I think that if he and the House were to consider that proposition a little further, it would be seen that it is going a little far to say that Government Departments should play a direct part in selling even Commonwealth wines. We do not play a direct part in selling or advertising our own goods even in the important export trade. Therefore, I do not think he will wish to press me further upon that matter.

Some reference has been made by my hon. Friend the Member for Southend, East (Mr. McAdden), and earlier by the hon. Member for Orkney and Shetland, to the use of Empire wines for Government hospitality. There are occasions on which Empire wines are served. There are some occasions—there is certainly one of which I am aware—on which Empire wines are served exclusively. The occasion I have in mind is the annual dinner for the British Industries Fair given at the Mansion House. I think I am right in saying that the wines there are all Empire wines.

From time to time Empire wines are served at other functions, but I can give no assurance that there will be nothing but Empire wines served at Government hospitality functions. I do not think my hon. Friends will really want me to go as far as that, but I will certainly take note of what they have said.

As to the availability of Empire wines in this House, I have no responsibility, but I suggest first of all to the exponent of Liberal philosophy, the hon. Member for Orkney and Shetland, that if there is to be a good supply of Empire wines in the House of Commons there must also first be a good demand, and perhaps the hon. Gentleman would like to start off by writing to the Chairman of the Kitchen Committee, joined by some of my hon. Friends, and press that matter upon him.

Mr. Grimond

A clear lead from Ministers in this respect would be very valuable.

Mr. Low

This seems to be a House of Commons matter which the one representative of the Liberal Party present in the House would like to leave to individual Members.

Now I would like to come to the facts. I am going to risk trying the patience of the House with one or two figures, because I think we ought to get this matter into perspective. The total consumption of all imported wines, is still less than it was before the war. In 1938–39 it was 15,220,000 gallons. In 1955–56 it was 12,670,000 gallons. The 1955–56 figure, however, is substantially above the 1950–51 figure.

Within these figures the consumption of light wines, including foreign and Commonwealth, has increased from just over 3 million gallons in 1938–39 to 5,400,000 gallons in 1955–56. In the same period the consumption of Commonwealth light wine has risen from 700,000 gallons to 1,020,000 gallons. It was only 670,000 gallons in 1950–51.

It is the heavy wines—this is the point—in which the consumption has decreased, both foreign and Commonwealth, but Commonwealth more than foreign. In 1938–39, 4,340,000 gallons of Commonwealth heavy wine paid duty, and in 1955–56 only 1,610,000 gallons. The fall in foreign heavy wine was from 7¼ million gallons to just over 5 million gallons in the same period. There was a fall, but not as big as the Commonwealth wines. Today Commonwealth wines represent about one-quarter of the total of heavy wines consumed in the United Kingdom, compared with about one-third before the war.

Within this picture of heavy wine, different countries and different wines have had different fortunes. The consumption of South African heavy wine as a whole is at much the same level as before the war. Therefore, with the decrease of the total imports, South Africa's share of the United Kingdom market of heavy wines has risen from 11½ per cent. in 1938–39 to 18 per cent. in 1955–56.

As the hon. Gentleman said—and my information is the same—this has been accomplished by more sherry to balance the smaller exports from South Africa to our country of port type wine, including vermouth. Similarly, Spanish sherry has increased its share of the United Kingdom market, while Portuguese port has decreased its share. In the same way, the Australian port type wines have lost ground very heavily, and it is that which explains the massive drop in the Australian figures which the hon. Gentleman mentioned.

I cannot go fully into the reasons for this, but clearly a change in taste between sherry and the port type of heavy wine has played a large part, because port and sherry pay the same rates of duty; so duty cannot be the reason there. I think that is clearly a valid point. Whether there has been a change of taste from heavy wines towards light wines, I leave that to my hon. Friends to make up their minds.

As to the facts about the duties, I do not think I need add to what my hon. Friend has said.

The next point which I want to take is what the hon. Member said about Cyprus, which he mentioned as a special case. Total consumption in the United Kingdom of Cyprus wines, both light and heavy, compares well with pre-war. It was 321,000 gallons in 1955–56, as against 374.000 gallons in 1938–39, and only about 220,000 to 250,000 gallons in the years before 1938. It is true that, within that total, we are drinking substantially less of Cyprus heavy wines.

My hon. Friend referred to some steps that had been taken in Cyprus itself about the wine industry. My information is that the Cyprus Government assist the wine industry in various ways. These include the operation of the Vine Products Scheme, under which a subsidised price is paid for Zivania, and also the payment of a subsidy in respect of fresh grapes delivered to manufacturers. Some difficulty is being experienced in finding markets for Cyprus wine products; but it does not at the moment constitute a major danger to the industry. It arises partly from import restrictions, or duties imposed by importing countries, and partly from certain internal problems of the Cyprus industry. The Cyprus Government arranged for an independent investigation of the industry, which has recently been completed. The recommendations include the establishment in Cyprus of machinery for quality control and the appointment of an officer in London to concern himself with marketing. I thought that my hon. Friends would be interested in that.

The hon. Member for Wavertree mentioned the colonial waiver. I do not think I ought to go into that in detail because the colonial waiver, as the House will know, involves alteration of a duty, and, since an alteration can be made only by way of legislation, it is not in order for me to talk about it. I would, however, like to remind my hon. Friend of the difficulties and conditions that are attached to the colonial waiver. They do not make it less valuable. The colonial waiver was very valuable and was welcomed by the Government and by my hon. Friends; but there are certain conditions, and I would recommend my hon. Friends to examine those conditions. It is a fact that Cyprus is not in large measure dependent on the United Kingdom market, and any action that we take to help Cyprus would also have the effect of helping Commonwealth producers. That is important, in deciding whether or not we get the colonial waiver. I cannot say more. Perhaps my hon. Friend, if he is interested, would like to study the matter further.

The last point, which I know is one dear to the hearts of my hon. Friends, is the importance of Commonwealth trade. I was glad to hear that the Liberal Party is now prepared so to trim its free trade policy that it will take account of the importance of Commonwealth trade. If I may say so, that is really quite an advance on the part of the hon. Member for Orkney and Shetland.

Mr. Grimond

Surely, Commonwealth trade has always been included in general trade; it is not a particular invention of this Government.

Mr. Low

Quite true, but in earlier days we did understand that the Liberal Party and my party were not in agreement about the importance which we, at any rate, attached to Commonwealth trade. But I understand that this afternoon we are all in agreement.

Mr. Grimond

So long as Whitehall is full of Liberals.

Mr. Low

Let there be no doubt that we attach great importance to the fostering of trade between this country and other Commonwealth countries. We are very conscious of the fact that it is in the interests of the sterling area as a whole, and the United Kingdom in particular, that trade should be at its highest between all Commonwealth countries. At this moment, we must all have in mind the difficulties which Australia has been encountering in her balance of payments, and we must all have in mind that anything which could be done to help Australia's trade and help her in her present economic difficulties might help her to relax the import restrictions which at present bear so hardly upon some United Kingdom industries.

We really must, however, keep this wine matter, if I may call it that, in its proper perspective. It is wine which we are discussing this afternoon. Exports of wine from South Africa and Australia have never represented a major part of those countries' exports. In the case of Australia, they represented only 0.6 per cent. of total exports in 1938, and 0.1 per cent. in 1953. The comparable figures for South Africa were 0.4 per cent. and 0.3 per cent.

Moreover, in the case of Australia in particular, the great bulk of wine is produced for home consumption. Thus, in 1954–55 the total production of all types of wines in Australia amounted to slightly under 24 million gallons, whereas total exports were only about 1¼ million gallons, of which exports to the United Kingdom were 864,000 gallons.

Therefore, whilst I do not want to minimise the importance, particularly for Australia, of increasing exports of wines to the United Kingdom, and generally of the expansion of her exports to the United Kingdom, I think that such an expansion could, at the best, afford only limited relief to Australia's balance of payments, and could have only a limited effect upon the total of Commonwealth trade.

Major Legge-Bourke

As my right hon. Friend has touched on the subject of Australia's position, would he bear in mind that there are some of us who are very anxious that, if any alterations are to be made to assist Australia, especially as regards the Ottawa Agreements, all should be brought under consideration and not only the Australian ones?

Question put and agreed to.

Adjourned accordingly at twenty-one minutes to Four o'clock.