HC Deb 05 June 1956 vol 553 cc990-1001

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

Mr. Bottomley

I have something to say on this Question because some new evidence has come to light which ought to enable the Chancellor to consider putting down an Amendment to the Clause to the effect that the granting of preferential rights for goods going through these two ports will be limited.

The new evidence is, as the House will be aware, that Sir Harold Hartley, who is chairman of a committee of the Organisation for European Economic Cooperation, has said in his Report that Europe will require about 500 million tons of coal more by 1975. He said that it would be idle to think that our power requirements will be fully met by the atomic energy available, by oil or natural gas, or by any other substitute that can be brought to bridge the gap.

The reason why I suggest that there ought to be a time limit to the preference given in this Clause is because, as the Financial Secretary will be aware, there is in Southern Rhodesia the rich coalfield of Wankie. That coalfield should be developed in the interests not only of our country but of Europe, which has been concerned with the Report, and of the dollar markets too. If the Government will only give consideration to the development of a railroad from that colliery to the coast, it will be possible for us not only to send coal along that route, but also goods which are at the moment going to the ports of Lourenço Marques and Beira. It is possible to take them from the nearest town, which is Matetsi, by the Wankie coal mine, to Gobabis, which links with a railway going via Windhoek to Walvis Bay.

I am assured that as the result of an investigation it has been shown that there are no major engineering difficulties. The bridging difficulties are nil and there are no physical or water problems. Therefore, it is a matter which could be looked at and dealt with at once, and it would enable us to avoid having to give for ever the same benefits in respect of ports in Portuguese territory that we give to goods passing through Commonwealth and colonial possessions.

I read that unless we do something about this, the Portuguese will extend another railway, and then in a subsequent Finance Bill similar concessions will be sought so that goods going through Lourenço Marques and Beira can have the same facilities to go through a Portuguese port on the west side. We are reinforced in the view that the Government ought to give consideration to this matter now by someone known to many of us, a great British supporter, Sir Roy Walenski, who said that it is possible for this scheme to which I have referred to be undertaken provided that the British Government take the initiative and are prepared to show that they are in support of the scheme.

I regret to say that there are no up-to-date trade figures in respect of the goods which go through Lourenço Marques and Beira. So far as I can ascertain, the last published figures in respect of exports going through Lourenço Marques —they come mainly from South Africa —showed that they totalled £13,674,081. I believe that that is about 4 per cent. of the total exports from South Africa. They go through Lourenço Marques, and we have to make the concession to them.

I am more concerned about not only the Wankie coal mine but also the Federation of Rhodesia and Nyasaland as a whole and the whole of Central Africa, which will, without doubt, be developed economically to the advantage of the Africans, the Europeans and the world as a whole. The exports from those territories which go mainly through Beira and not so much through LourenÇo Marques amount to roughly £130 million, representing 88.2 per cent. of the total exports from those territories.

If the Government will make the new Clause temporary in application and give serious consideration to the spending of a certain sum—I do not know the latest estimate, but one which was given was £15 million—it would make it possible for us not to give these Imperial concessions for ever to goods which go through foreign territories and to develop the British Commonwealth and Colonies with advantage to them and this country. I hope that before the Report stage the Government will consider tabling an Amendment limiting the application of the concession to a given period in the hope that in the meantime we can proceed with the railway, which will be of great advantage to the British Commonwealth as a whole.

Mr. Beswick

I am sure that the Committee generally will be pleased that the Government have given some consideration to the problem and have gone some way, if not as far as they might have done, to meet the situation which has been disclosed.

What surprises me is that, having put in the Bill a Clause to give some assistance to the growers in the territories mentioned, the Chancellor or the Financial Secretary could not have given me some more information about the effect of the increased tobacco tax upon Empire tobacco. The preference now accorded to tobacco grown in Rhodesia, where it is one of the principal crops, is negligible —1s. 6½d. per lb. At one time in the history of the tax it represented a 25 per cent. preference.

9.15 p.m.

Due to the increasing level of the tax in this country, now £3 1s. 2d., 1s. 6½d. today works out at about 3 per cent. preference. I should have thought that as the Government have given some thought to the problems of the growers in Rhodesia, for example, as instanced by the fact that they have brought forward this Clause, they would have got on to the subject of Empire Preference on tobaccos and the way in which its value has been whittled away.

I appreciate that there is a very difficult problem here and that questions of G.A.T.T., and so on, come into it, but, nevertheless, as we are thinking about the welfare of these territories, as we want to encourage the growers in these areas and give them the Empire preference to which they are entitled, I should have thought that, as far as the tobacco tax is concerned, we should endeavour to see that the value of the preference is not whittled away by the increasing rate of taxation in this country.

If the Minister cannot give us an answer to that aspect of the problem now, I hope he will say that the Government intend to go into the problem to see whether something cannot be worked out and a solution to the problem found later.

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

I think that I should be wholly out of order if I tried to give any answer to the interesting query which the hon. Member for Uxbridge (Mr. Beswick) has raised. The Clause has a simple object, which is really threefold. It puts the goods of the Federation of Rhodesia and Nyasaland, consigned through Lourenço Marques, on the same footing as goods consigned through Beira, and in doing that fulfils an undertaking which we have given to the Government of the Federation of Rhodesia and Nyasaland.

The second thing it does is to put goods of Bechuanaland on the same footing as goods of the Federation of Rhodesia and Nyasaland, whether consigned through Beira or LourenÇo Marques. The third thing it does is to put the goods of the Union of South Africa and Swaziland on the same footing as the goods of the Federation of Rhodesia and Nyasaland, if consigned through Lourenço Marques.

The right hon. Gentleman the Member for Rochester and Chatham (Mr. Bottomley) referred to the Walvis Bay proposed railroad, about which we have all read, and the coal proposition. The Clause deals with railroads that now exist and the Committee need not be too concerned about the coal proposition, because coal comes in duty-free from wherever it is consigned and Imperial Preference does not come into the matter.

We would be wise to accept the Clause as it is. It in no way prejudices the development of any new railroad to Walvis Bay, nor does it prejudice any coal scheme. It is of value to the trade of the territories mentioned and fulfils an undertaking which we have given and which will help to relieve the considerable pressure which there has been on Beira.

Mr. Bottomley

I was suggesting only that this reinforces the need for the railway. I accept what the Minister has said about coal not attracting duty. The point is that we are not getting coal from Wankie Colliery, or other valuable goods which could be produced in Central Africa. The sooner we build that railway, the sooner we will be able to get those goods and avoid having to send them through Lourenço Marques or Beira.

Mr. H. Wilson

We have not had a very full explanation from the right hon. Gentleman. I should like to add a few words to what my hon. Friend the Member for Uxbridge (Mr. Beswick) and my right hon. Friend the Member for Rochester and Chatham (Mr. Bottomley) put to him, in the hope that we shall get a rather fuller answer. He seemed to think that if he ruled certain questions put by my hon. and right hon. Friends out of order he did not need to answer them. With the greatest respect to him —and we all have a very great regard for him—it is for the Chair to decide what is and what is not in order. I submit that some questions put by my hon. and right hon. Friends have a very real bearing upon the question whether it is right for the Committee to assent to the Clause.

Upon reading the Bill and seeing the Clause, my first thought was, "This sounds a very good thing. After having the usual reasonable explanation from the Government, I am sure that we shall want not merely to assent to it but to support it with some enthusiasm." But the right hon. Gentleman's account was perfunctory, to say the least. This must be one of the very rare cases in the history of Finance Bills when a Clause has been commended to the Committee without any suggestion about the volume of trade or the amount of money involved.

The right hon. and gallant Member for Leicester, South-East (Captain Waterhouse) is usually very punctilious in wanting to know the exact details of the cost in any matter of Government expenditure. He is absolutely right, and it is in accordance with the traditions of the House that he should do so. But surely, when there is a question of a change in tax revenue, it is equally right that the Committee should be told how much money is involved.

My hon. Friend the Member for Uxbridge raised the question of tobacco preference. I agree that we should all be in danger of getting out of order if we sought to argue the merits of the Imperial Preference system in general, or even the rates of preference. There may be an opportunity to do that after the President of the Board of Trade has made his statement about G.A.T.T. which, I understand, will be on 7th June, or so the right hon. Gentleman told us this afternoon. At any rate, it would be wrong for us to go into that matter in any detail this evening.

But the question of Imperial Preference must have some bearing upon the volume of tobacco grown in the Federation and shipped through the two ports in question. It would be interesting if the right hon. Gentleman could give us some idea as to how much he thinks will be shipped through these two ports, and what will be the difference in terms of the loss of revenue to the Treasury through the application of the Imperial Preference system.

We all welcome the fact that, since the war, tobacco imports from what is now the Federation have greatly increased. I think I may claim that during my period of office at the Board of Trade we did a great deal to increase the amount, partly by the very rigid restriction upon the imports of dollar tobacco. but also by insisting upon the bulk buying of tobacco through the Imperial Tobacco Company.

The Temporary Chairman (Sir Austin Hudson)

The right hon. Gentleman is going a little too far. I am in some difficulty in ruling a certain matter out of order because I do not know what the goods are, but I think that he is going a little too wide.

Mr. Wilson

I shall endeavour to confine my remarks more narrowly to the Clause—but hon. Members are in the same difficulty as you are, Sir Austin, because, in the very short account which the right hon. Gentleman gave of the reasons for the introduction of the Clause, he gave us no impression as to the nature of the goods involved.

Mr. Low

May I correct what I think is a misunderstanding on the part of the right hon. Gentleman? He must have forgotten some of the things that he used to know when he was President of the Board of Trade.

This provision does not import any new principle. For a long time goods consigned from Beira have enjoyed this concession, and tobacco from Rhodesia comes mainly through that port. We are not changing anything in relation to the sale of tobacco from Rhodesia, nor are we introducing a new principle. In the case of goods made in Rhodesia and the other places I have mentioned, we are putting goods consigned from Beira in the same position as goods consigned from Lourenço Marques.

Mr. Wilson

I hope that I have not forgotten any of the things I knew when I was at the Board of Trade—including some of the rather extraordinary remarks which hon. Gentlemen opposite used to make. But I should be out of order were I to tax my memory to any great extent upon those subjects.

The Committee understood the point which the right hon. Gentleman made in his intervention. What we wish to know is how much of this tobacco the right hon. Gentleman expects will be going through Lourenço Marques in the future. Perhaps he will say that it is a matter for normal trade channels and that it is impossible for the Government to make an estimate of it.

The hon. Member for Wokingham (Mr. Remnant) spent a long time trying to get me to talk about tobacco, and as soon as I begin hon. Gentlemen opposite get worried. But, turning from tobacco, I wish to remind the Committee that my right hon. Friend mentioned coal. I take the point at once that coal, being duty-free, is not directly involved in this Clause. But the Minister of State will recall—it certainly was the case some years ago, and I think it still is—that the port of Beira in particular has been heavily congested; and that places a severe limitation on the amount of goods passing through the port. Of course, the amount of coal coming down from the Wankie Colliery, no matter by what route, either existing routes or future routes, will affect the congestion of the port and therefore will affect the volume of dutiable commodities going through it. I suggest, therefore, that my right hon. Friend was not wide of the mark. nor out of order, when he referred to coal.

I hope that the Minister will, if possible, give us a little more information on the point. I think that we have the right to ask him how much revenue he considers will be involved. We consider this to be a serious and sensible proposition, and we shall be glad when it is no longer essential to rely on these Portuguese ports for the shipment of goods which must be regarded as of British origin. Anyone dealing with—as I did during the concluding stages of the war and in my period at the Board of Trade— the difficulties of coal shipment from that area will know how grave are those difficulties, and what a heavy cost this country is paying because of our dependence on these two ports. The sooner we have a British port in the area which may be used for the purpose, the better.

Until that happy day, I am sure it is right that developments through ports other than Beira should be able to claim the advantages attaching to Imperial Preference. Apart from our wish that the right hon. Gentleman should be able to give a little more information on this point, I am sure that we wish to see this Clause pass into legislative effect.

Captain Charles Waterhouse (Leicester, South-East)

I wish to endorse what has been said about the desirability of this Clause. It is true that it is a great misfortune in some ways that our great possesions in Central Africa should be bordered on either side by foreign territory. On the other hand, it is a great good fortune that the territory should be in the hands of the Portuguese, who have been our firm friends over generations.

The two ports mentioned are both to the east. It has not been mentioned that there is another port, Lobito, to the west. It is reached by Angola, by the Benguela Railway, which has the peculiarity of being a privately-owned railway, owned by British capital and built by British initiative. I have no financial interest in that railway, although I have a considerable interest in the area because I have a son who is farming there.

I welcome this Clause. I hope that my right hon. Friend will, on a future occasion, remember that there is this other access from the west to our Central African possessions and that it may at some time be convenient for us to have an access to the west to avoid the possible difficulties, which we all have in mind, arising over the route to East Africa through the Mediterranean.

9.30 p.m.

Mr. Beswick

I do not propose to argue at any great length with the Minister of State whether or not I was in order in my previous intervention. I am prepared to leave that decision to you, Sir Austin. I am bound to say that it seemed quite unusual for Members of the Committee to welcome a Clause when the representative of the Government spent so much time belittling its importance and effect. At the end of what the Minister of State had to say I was left wondering why he had put the Clause into the Bill at all if the consequence was to be so small as he suggested.

My question was about one of the important crops in this area, tobacco. As I understand, the reason for the Amendment is to grant to the tobacco which is being shipped from the port of Lourenço Marques the same amount of preference—

Mr. Low

I would like to put the hon. Gentleman right—

Mr. Beswick

Please let me complete my sentence—that it would enjoy if it otherwise were shipped to this country. I want to know whether it is worth while putting the Clause in the Bill if the effect of that preference is so small. If the effect is so small, with the present high rate of taxation, would the right hon. Gentleman assure us that this aspect of the matter is being looked into? That is all I want to know.

Mr. Low

I wanted to interrupt the hon. Gentleman to remind the Committee that the concession does not apply to revenue duties and, therefore, it does not apply to tobacco. When I interrupted the right hon. Member for Huyton (Mr. H. Wilson), earlier, I was not dealing with all the points, but only with the place at which the tobacco came out.

Mr. Bottomley

I want to reinforce one point which I hope the Minister of State Will draw to the attention of the Chancellor of the Exchequer and his other colleagues in the Cabinet. He quite rightly says that Lourenço Marques is brought in and that the same concession is being made on goods going through it as to those that go through Beira. The reason that the right hon. Gentleman gives is that Lourenço Marques is to have an extended railroad put in by the Portuguese, who have said they will take the railroad to the West.

The Minister of State, or a future Chancellor of the Exchequer, may come to the House and say, "Now that that has been done, we have to make the same concession". We ought not to be put in that position, so I ask the right hon. Gentleman to give an assurance that he will look into the question of building a British railroad to the West before the Portuguese finish their own and we have to put a similar Clause in another Finance Bill as we are having to do in the case of Lourenço Marques.

Mr. Low

What we have done in the Clause does not commit us to do a similar thing anywhere else. My right hon. and gallant Friend the Member for Leicester, South-East (Captain Waterhouse) raised the question of the other existing railway out to Lobito Bay. It was considered whether the concession should be extended in that case, but it was thought unwise and unnecessary. At present, I understand that most, if not all, the produce that comes from the Federation along that railroad and comes to us, is duty-free produce. The obvious example is copper. Therefore, it was not necessary to extend it. We should certainly consider that case again if it became necessary to do so in the future.

I would make it clear that this concession, this putting of Lourenço Marques in the same position as Beira is of importance to our trade with the Federation and with the other territories. I am sure that the right hon. Gentleman the Member for Rochester and Chatham (Mr. Bottomley) appreciates that it is impossible to be quantitative in regard to the money values. Indeed, it may well be that in greatest result of the concession is n administrative convenience. As the right hon. Member for Huyton (Mr. H. Wilson) may remember, it has always been possible to export from the Federation of Rhodesia through the port of Lourenço Marques and, indeed, through any other port and to gain the advantage of Imperial Preference before the Clause existed, provided that arrangement were made so that the goods were consigned direct from the Federation to here. That results in administrative problems.

As the Committee will understand, arrangements had to be made at the port, in case the goods were held up, to store them in separate stores, and so on. Perhaps the greatest advantage in this concession will lie in the administrative easements and, therefore, it will help our trade. With that explanation, I commend the Clause to the Committee and hope that it will be accepted.

Mr. H. Wilson

I do not know why the noble Lord the Member for Dorset, South (Viscount Hinchingbrooke) is so anxious that we should divide on the Clause. Although he has not spent a great deal of time in the Chamber today, I hope he will realise that the Opposition have been extremely co-operative in the speed in which they have helped to get the Bill through. We spent an hour and a half tonight on an issue raised by a Government back bencher. I understand that either tonight or. as one trusts, on Thursday, we shall be listening to discussion on Amendments moved by the noble Lord. I hope, therefore, he will not object if we spend a minute or two more in dealing with this important Clause.

The noble Lord may remember that in October, on the last Finance Bill, it was five days before we got to the similar Motion on Clause 1. He should not, therefore, be impatient that we have only got to Clause 3 on the first day of this Bill in Committee, although I do not suggest that everything that happened in the autumn should be necessarily a precedent for our handling of this Bill.

The Minister of State, Board of Trade, has answered, I am sure, as well as he is able the points which have been put to him from this side. One understands that it may be difficult to quantify. to use the right hon. Gentleman's phrase, the amount of revenue that is involved. As he said, the strongest argument is a matter of convenience in the transmission of goods from the Federation.

I was glad to see how the right hon. and gallant Gentleman for Leicester, South-East (Captain Waterhouse) endorsed what was being said from this side of the Committee on the Clause. It is quite a treat to see him supporting his own Front Bench. It is even more of a treat to see him supporting the Front Bench on this side. Having said how much we welcome it, however, perhaps the right hon. and gallant Gentleman will allow me to dissociate myself from one expression he used lest it may be thought that, since we were so close together in supporting the Clause, we are necessarily tied by every phrase he used.

The right hon. and gallant Gentleman referred to the Federation as being one of our possessions. I know that he still clings to that old-fashioned mode of thought, which is not serious except when it affects his attitude to other questions, which is damaging for the country. When the right hon. and gallant Gentleman used the term "possessions ", it was not a phrase which we use.

Captain Waterhouse

Rubbish.

Mr. Wilson

The right hon. and gallant Gentleman may think it rubbish, but we must dissociate ourselves from that phrase, and so also, I am sure, will the Government Front Bench.

Having said that, I shall call on my hon. Friends to agree to the Clause now going through without a Division and I hope that it will have the good results that the right hon. Gentleman has forecast for it.

Question put and agreed to.

Clause ordered to stand part of the Bill.