Import Surcharge (Hansard, 27 October 1966)

§ 13. Mr. Dodds-Parker
asked the President of the Board of Trade what increase in imports he is expecting in the first three months after, compared with the three months before, the removal of the 10 per cent. surcharge; and what action he is proposing to correct this increase.

§ Mr. Darling
Some temporary increase in imports is expected to take place after the surcharge is removed, but this was fully taken into account when my right hon. Friend the Chancellor of the Exchequer said that we should achieve a surplus for 1967 as a whole on current and capital account combined. My right hon. Friends the Prime Minister and the Chancellor of the Exchequer explained in July that the far-reaching economic measures taken then were designed to improve our general economic position and to restore our balance of payments.

§ Mr. Dodds-Parker
Will the Minister of State give an assurance that when he sees how the figures work out he will on no account take any action prejudicial to our partners in E.F.T.A.?

§ Mr. Darling
That undertaking has already been given by the Prime Minister.

§ Mr. Sheldon
Is my right hon. Friend aware that in each of the past 10 years, 1280 despite the heavy inflation in some of those years, imports have risen in real terms steadily year by year? In view of the massive encouragement being given by the removal of the surcharge, has he any reason to expect that we shall see anything other than a massive increase in imports?

§ Mr. Darling
Yes, Sir. The facts, as we see them, were given in a series of replies in the House, and we have come to the conclusion that although, as I have said, there will be some increase in imports, we do not think that it is likely seriously to interfere with the balance of payments projects which we have in mind.

§ Mr. Barber
What estimate has the Board of Trade made of the increase in the three months following the removal of the surcharge? Obviously the Government have made some estimate, otherwise they could not be planning ahead in a sensible way. If they have made an estimate, why can it not be given?

§ Mr. Darling
Estimates in these circumstances are likely to be very temporary ones and perhaps not very useful, in the circumstances. We have decided that we are not going to introduce import quotas. We shall see how this goes along, and we think that the judgment which we have taken will work out all right.

§ 17. Mr. Dickens
asked the President of the Board of Trade what steps he proposes to take to control imports following the lifting of the import surcharge.

§ Mr. Darling
None.

§ Mr. Dickens
Is my right hon. Friend aware that that negative response is most disappointing to many of us on this side of the House? Does he not feel that there is a very strong case for examining the need for selective, flexible quotas to keep out non-essential imports; otherwise, how does his right hon. Friend propose to keep down the inevitable increase in imports which will occur when economic expansion is resumed?

§ Mr. Darling
My right hon. Friend the Chancellor of the Exchequer explained on 26th July the difficulties about using import quotas for the purposes which my hon. Friend has mentioned. First of all, they would be only a temporary remedy, and we have 1281 already used the import surcharge in substitution for them on temporary grounds. If we were now to introduce quotas in these circumstances, the first effect would be a retaliation from the countries concerned and, as the hon. Member for Cheltenham (Mr. Dodds-Parker) has said, the E.F.T.A. countries would seriously question such measures and, moreover, the quotas would not remove the need for disinflationary action.

§ Sir G. Nabarro
Would not the right hon. Gentleman agree at once that if import quotas were imposed, they would deny opportunities to countries oversea, notably under-developed countries, to earn sterling with which to buy British exports? Is not the suggestion of the hon. Member for Lewisham, West (Mr. Dickens) absolutely fallacious?

§ Mr. Darling
That is the reason why I mentioned the retaliatory character of quotas.

§ Mr. O'Malley
Does not my right hon. Friend recognise that the steel industry is a special case in this respect? A very large increase in dumped steel imports is likely in the coming months, which will affect the steel industry in the right hon. Gentleman's constituency and my own at a time of falling demand and short-time working.

§ Mr. Darling
The question of dumping is another matter altogether. We can deal with dumped imports.