§ EARL BEAUCHAMP rose to move to resolve, That the available figures relating to the articles which have been given a Duty under the Safeguarding White Paper procedure show that Safeguarding is a failure. The noble Earl said: My Lords, it has always been one of my minor ambitions to make a speech in your Lordships' House on the subject of Free Trade and Protection which would be entirely non-controversial in its character. It is an ambition which is hardly likely to be fulfilled this afternoon, but I hope that, at any rate in regard to the figures that I shall venture to put before the House, there will be no occasion for controversy. These figures are all taken from various Government publications, from the Trade and Navigation Accounts, the Ministry of Labour Gazette and occasionally from the OFFICIAL REPORT. At the same time it seems to me that it may be advisable, after the termination of three or four speeches, if your Lordships were given an opportunity of considering these figures and of adjourning the debate until a time mutually agreeable to noble Lords opposite and to those who sit in this part of the House. I hope, in any case, that 980 there need be no discussion as to the accuracy of the figures that I shall put before your Lordships.
§
There is always one difficulty in discussing this matter, and that is that people so often use the same words anti mean different things. Take, for instance, the actual meaning of the words "Safeguarding" and "Protection" Some people tell us that the words mean different things, and other people tell us that they mean the same thing. Mr. Winston Churchill, for instance, speaking in Manchester, on January 21 of this year, said:—
I am glad to think that so far as His Majesty's Government is concerned there is no question of the establishment of a general system of Protection being made an issue at the next Election.
Safeguarding, on the other hand, he said, was a matter for business men. The Prime Minister in the same way, a few days later, said that we should
examine Safeguarding as a business and economic problem and not a political one. Protection, as we should use the term in politics, is a different thing.
On the other hand there is a quotation from Mr. Amery in a letter in The Times of April 5, 1924, in which he said:—
The policy (of Protection) has not been erased. All that has happened is that for the more direct and effective method of a tariff all round has been substituted the somewhat slower method of legislation on the lines of the Safeguarding of Industries Act. The policy itself and its essential objects…remain unaltered.
A speaker at the National Union of Manufacturers' meeting at Liverpool said:—
A crumb is better than no meal, but what we want is a substantial meal of Protection. Safeguarding and Protection mean precisely the same thing. It is contradictory of the Government to extend Safeguarding and in the same breath to say that they do not want to introduce Protection.
Then on the other hand, and following the same line of argument as the Prime Minister and Mr. Winston Churchill, the National Union of Conservative and Unionist Associations have just published a Hand Book entitled Safeguarding, the Past, Present and Future, and they distinguish between Protection and Safeguarding. They say:—
Protection is a general system of taxation on imported goods capable of being applied by the will of the Government and subject to the approval of Parliament to any industry whatsoever without the re-
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quirement that the industry should make previous application for Protection or any substituted tests or conditions.
Safeguarding, on the other hand, is definitely limited in its scope:—
It can only be applied in particular cases, the industries of which"—
and they go on to describe the conditions of the Safeguarding White Paper.
§ I hope I have made it quite clear from the terms of my Resolution that I am very anxious to make a distinction between industries which are protected and industries which are merely safeguarded. The Federation of British Industries has issued a number of statistics in which they lump together the figures relating to protected industries and safeguarded industries, and they say that because the figures which they give are satisfactory, therefore we should proceed further in the direction of Safeguarding. If Protection and Safeguarding are the same thing, I can understand the figures being lumped together, but if, as so many people speaking on behalf of the Conservative Party make a point of emphasising, the two things are different, I cannot see the logical consequence of lumping the two figures together, though I am bound to say that if they did not do so they would probably not be able to make out the case that they seek to make out.
§ These figures, in which they lump together protected and safeguarded industries, have received very high sanction. I think even the noble Lord on the, Woolsack has used them on the authority of the Federation of British Industries. I have no complaint what ever to make, and no criticism of the figures, but my criticism is that if Protection and Safeguarding are different things the two sets of figures should be separated one from the other. There are, of course, the McKenna Duties, imposed in 1915, which affect motor cars, cycles, films, musical instruments, clocks and watches. To these must be added Commercial Motors, Tyres, Silk and Artificial Silk Duties, and the Duty on hops, none of which come under the category of Safeguarding Duties, as they were never subjected to the conditions of the Safeguarding White Paper. If they were not, strictly speaking, safeguarded goods, it is inconsistent to use 982 figures connected with them in order to promote the idea of Safeguarding in regard to other articles.
§ Therefore the terms of my Motion are drawn up in a way which will exclude any of those protected goods which have not been put upon the list of the tariff through the method of the Safeguarding White Paper. The case made for Safeguarding is that exports will go up, imports go down, employment improve, and wages, no doubt, follow that improvement. It is striking to see what has been the actual effect with regard to Safeguarding Duties. Exports have gone down by £1,500,000, imports have been reduced by £1,250,000, and the re-export trade has been entirely killed. Your Lordships will see that although exports have been reduced and imports have been reduced, the imports have been reduced less than the exports, and there is no reason therefore to suppose that there has been any sufficient increase in the whole trade to compensate for the loss of exports. I am afraid that it is really necessary to go into these figures in some detail with regard to each one of these safeguarded articles. I must apologise, because I cannot pretend to think that figures of this kind can be very interesting, but it is important that they should be put upon record.
§
I take first the lace industry. The gross imports have gone down from £2,331,486 in 1924 to £513,000 in 1928. Re-exports have gone down from £1,833,263 to £109,000 in the same period. The retained imports have gone down from £498,223 in 1924 to £404,000 in 1928. The domestic exports have gone down from £2,620,733 in 1924 to £1,760,000 in 1928. The figures of effective employment—a technical term which is well understood among those who take an interest in the matter—have gone down from 16,543 to 15,634. The number of insured workers, that is to say, the number of people who still hope to gain employment in the lace trade, has dropped from 20,350 in 1924 to 17,120 in 1928. That means that no fewer than 3,000 workers in the lace trade have given up the hope of seeing themselves once more employed in that trade, and they are no longer to be found among the insured workers. There has been a great deal of disappointment in Nottingham
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with regard to the result of Safeguarding. The recently published report of the Amalgamated Society of Operative Lacemakers states that:—
While one or two trades are doing better than a year ago, trade in general leaves much to be desired, and the good things promised by the introduction of Safeguarding Duties do not appear to have materialised to the extent desired.
It records that the levers section of the industry has fallen on very evil times, many firms going out of existence, with short time work in most of the survivors; whilst the lace curtain section, formerly flourishing, is now declining.
§ I now turn from lace to cutlery. Here is a case in which the gross imports have increased. In 1924 they were £389,912; in 1928 they were £469,000. Re-exports have gone down from £101,866 to £93,000. The retained imports have increased from £288,046 to £376,000; and the domestic exports have increased—which is, of course, one of the things always claimed as an advantage of Safeguarding: it has happened in this case—from £912,866 in 1924 to £1,180,000 in 1928. But the effective employment is reduced between 1924 and 1928 from 27,413 to 26,976. On the whole I do not think it can be said that the example of cutlery affords, even standing by itself, very great evidence of the success of Safeguarding in that industry.
§ I turn to gloves. Here, unfortunately, it is necessary to give your Lordships a double set of figures because there are the leather and fur gloves and also the fabric gloves, and it is desirable in order to prevent any confusion that these figures should be given separately. In the case of leather and fur gloves, comparing 1924 and 1928, the gross imports have gone down from £1,719,788 to £1,179,957; the re-exports from £122,875 to £117,552; the retained imports from £1,596,913 to £1,062,405; the domestic exports have increased from £144,741 to £184,004. When we turn to the case of fabric gloves, which occupied the attention of people to a considerable extent some years ago, there is a different tale to tell. In this case the gross imports have gone up from £565,761 to £826,162; the re-exports have declined from £109,533 to £42,179; the retained imports have increased from £456,228 to £783,983; the domestic exports have fallen from £66,607 to £31,585. So that in the case 984 of fabric gloves the general result is diametrically opposite to that in the case of the leather and fur gloves.
§ But in regard to the employment in the fabric glove industry I would call attention to a pamphlet on Safeguarding which I think I have already mentioned. It was published by the National Union of Conservative and Unionist Associations and deals with the effect of safeguarding on employment in the fabric glove section. It is on page 18. I suppose it is only a mistake made in printing and I do not attach any very great importance to it, but they say that in 1928 there were 1,800 persons employed and lower down on the same page they say that only 786 persons were employed. I have no doubt that that is an error, but it is one of those errors which lead to confusion when one is arguing upon a question. The price of long gloves has gone up still more. They cannot be manufactured in this country, and, as a matter of fact, I do not think they ever have been. In regard to leather gloves, the lighter makes are not being made in the country for spring trade, as it was always claimed that they would be when the Inquiry was held in respect of the Duty being put on; therefore there is still a considerable amount of seasonal unemployment in the leather glove trade. In regard to fabric gloves, instead of the production being much larger, it is smaller than it was in 1923. In 1925 the number employed was approximately 1,800, working on short time, and in 1928 the number was less than 1,400, working upon fuller time, that is to say working rather longer hours. I think there is very little encouragement for Safeguarding to be found in the example of gloves.
§ We turn to gas mantles, where there is less encouragement still. The total imports in 1924 were £160,596 and in 1927 £42,905; for 1928 no figures are available. With regard to employment, in answer to a Question in the House of Commons it was stated that the numbers employed in the industry appeared to be much the same as in 1925. But there is a good deal behind a statement of that kind. The British manufacturers of gas mantles have agreed to pay for five years 1s. 4½d. per gross on the mantles produced by the associated manufacturers in this country to the German Convention or Cartel, in return for which the German manufacturers agree not to export gas 985 mantles to this country. Did anybody ever suppose that the granting of a Safeguarding Duty on gas mantles was going to end in a tribute being paid to the manufacturers of gas mantles in Germany? It is a modern form of Danegelt. I do not think there is a more striking example of the failure of Safeguarding than in this matter of gas mantles. With regard to prices, English "standard" mantles in 1925 were £1 6s. 3d. per gross and in 1927 £1 13s. per gross. The German mantle in 1925 was £1 1s. 9d. per gross plus 9d. thorium duty, making the landed price £1 2s. 6d. per gross. Under the present Duty, if there had been no agreement, the landed German price would still have been only £1 8s. 6d. per gross—4s. 6d. less than the present price—an increase of about a penny per mantle to the consumer.
§ I turn from gas mantles to packing and wrapping paper. The gross imports were £4,844,494 in 1924 and £3,974,000 in 1928; the re-exports were £22,676 in 1924 and £24,000 in 1928; the retained exports were £4,821,818 in 1924 and £3,950,000 in 1928; and the domestic exports were £578,799 in 1024 and £517,000 in 1928. In regard to employment, the duty on kraft paper had such disastrous effects on the textilose industry which used it, as raw material that the employees were reduced from 200 to 25 and within a year that section of the Duty was repealed by the Government which originally put it on. The damage in other cases is not concentrated and is therefore not easily discerned. The sixpenny kraft cord bag manufactured at Manchester was knocked off the market by the Duty and was remannfactured when that particular Duty was removed.
§ Now I come to pottery, and here again I am sorry to think that it is necessary to divide the trade into more than one section, and for this reason—that it is understood that prior to the imposition of the Duty a considerable proportion of the imports of translucent or vitrified pottery were described on entry as general earthenware. Indeed, when one comes to analyse the figures it becomes obvious that something of that kind must have happened because of the astonishing variations that occur. The gross imports of china and translucent pottery, which in 1924 were £13,264 became in 1928 £329,397. That enormous increase in the imports is due, I think, really to this 986 special question of classification. The re-exports, which in 1924 were £7,360, were £6,622 in 1928. The retained imports were £5,904 in 1924, and £322,775 in 1928. The domestic exports, which in 1924 were £310,011, were in 1928 £461,220. In regard to general earthenware the gross imports sank between the two dates, 1924 and 1928, from £724,002 to £338,043; the re-exports from £23,653 to £14,017; and the retained imports from £700,349 to £374,026. The domestic imports in the same period sank from £3,627,131 to £2,766,755. I think if your Lordships will be good enough to take the trouble to-morrow to look at the figures it will probably be evident that that is due to the difference in classification, about which there is no difference of opinion among the controversialists in this matter. It is not one of substance but it is due, I think, to the difference in classification which is now more accurate than it used to be.
§ I take now the totals for pottery and general earthenware. The gross imports have gone down from £737,266 in 1924 to £717,440 in 1928; the re-exports, from £31,013 to £20,639; the retained imports, from £706,253 to £696,801; and the domestic exports—again one of those figures which, if the prophecies which have always been held out by the Safeguarders had been fulfilled, would have increased—have sunk from £3,937,142 to £3,227,975.
§ In this matter I am told to deal with the question of prices. The 9-inch dinner plate which was formerly 6d. now costs 10d. The milk jug which was formerly 6d. is now 10d. and the egg cup which used to cost 1d. now costs l¼d. or l½d. The tea set of twenty-one pieces which used to be 6s. 11d. is now 8s. 11d., the cup and saucer which used to cost 6d. now costs 9½d., and the small jug which was 9d. is now 1s. 3d. I do not say, of course, that you cannot buy plates and jugs, or cups and saucers for the same amount as you paid before the Duty was put on. What I say is that goods of the same quality cannot be bought at the same prices as were charged for them before the Duty was imposed. The figures for prices really refer to imported articles only.
§
There are no figures or statements as to unemployment in the pottery industry alone. That is probably due to the reaction of our heavy Duty on china on
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our earthenware industry. In spite of the China Duty, unemployment in Long-ton, which is the centre of the fine china industry, remains acute. I should like to quote something from the Pottery Gazette, which is the principal trade organ. In the current issue, for February, 1929, this statement is made:—
So exceptional were the queues of work-people waiting for unemployment pay at Longton about Christmas time that the town hall had to be used as a temporary Labour Exchange in addition to the extensive new Labour Exchange building which came into service six months ago.
Seasonal unemployment is expected in December, but this year it was marked as being "exceptional"
§ I come now to buttons, in regard to which, of course, the Duty has been put on so lately that it is difficult, if not impossible, to make an adequate comparison. There are no figures available at the moment for 1928. I shall, nevertheless, venture to give some figures to your Lordships. In this case, comparing 1924 with 1927, the gross imports rose from £749,000 to £948,000; the re-exports sunk from £146,000 to £123,000; the retained imports rose from £603,000 to £825,000; and the domestic exports sunk from £215,000 to £189,000. I imagine in that case that the prospect of the imposition of the Duty had a good deal to do with the variation in figures. But the prices now show that the one-inch coat button which used to be 5s. 11d, per gross is now 8s. 11d., that the 22-line vegetable ivory button which used to be 1s. is now 1s. 11d. per gross, and that the 50-line vegetable ivory button which was 7s. is now 11s. 9d. per gross.
§ Your Lordships will be glad to hear that I have now come to the last of the single industries to which it is necessary to call your Lordships' attention, and after that I shall venture to give the totals. Enamelled hollow ware was only brought in by the Finance Act of 1928 and it is evident, of course, that the Duty has been put on so lately that it is impossible to give any useful comparative figures. I will content myself in this case, therefore, with giving the prices. The enamelled saucepan which used to cost 1s. 10d. is now 2s. 3d.; the 32-inch enamelled bath which used to be 7s. 6d, is now 8s. 6d.; and the 34-inch enamelled bath which was formerly 8s. 6d. is now 10s. 6d. These are articles 988 which it is not profitable for the British manufacturer to produce even at present prices, and which, I believe, are still always imported. The common enamelled pail was formerly 12s. 10d. per dozen wholesale and is now 15s. 7½d. per dozen. Wholesale prices have not risen quite in proportion to the Duty because the quality has changed and the foreigner is now producing a pail which is 4d. a dozen cheaper.
§ Now I am glad to think that we may deal with the totals. First of all, I take the retained imports of goods safeguarded under the 1925 White Paper, and comparing 1924 with 1928 it will be seen that whereas in 1924 the total was £8,526,921, it had gone down to £7,273,189 in 1928. It is not, I think, unfair to say that in this case the rise in price is probably responsible for the reduced sale. If we take the re-exports of these goods, which are safeguarded in all these cases—they are nothing else; that is to say, not protected goods—we find that the re-export trade is killed; because, whereas in 1924 the goods were of the value of £2,222,382, the value had sunk to £406,370 in 1928. That obviously means that the re-export trade of this country in these articles, which gave a great deal of occupation and profit to our merchants and a great deal of trade to our mercantile marine, has really been killed.
§
The totals for the domestic exports of goods safeguarded were £8,309,468 in 1924, but they sank to £6,900,564 in 1928. The prophecy that exports would go up has been proved to be wrong; and not only that, but there is a, progressive decline. The figures of each year show gradually diminishing exports—one of the worst signs for the export trade of this country—which means in each successive year fewer of those goods are being made in this country. This, no doubt, is one of the reasons for the increase in unemployment in this country. I found an interesting letter in The Times of January 26, in which the employers on the Wool Textile Industrial Council in the Northern Counties wrote to the operatives saying that they were unable to agree to the suggestion for a joint meeting. They ended by saying:—
Your Executive Committee appear to ignore the fact that any advantage to be derived from a Safeguarding order cannot in
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any way assist in that recovery of the export trade which is essential for any important improvement in the state of the industry.
That from the employers in this particular industry is a fact of a somewhat remarkable character.
§ I should like to deal with some of the figures with regard to unemployment. A very valuable and interesting pamphlet has lately been issued by Mr. Rowland Evans dealing with all those goods—protected goods as well as safeguarded goods. I shall not venture to trouble your Lordships with anything about the protected goods but will content myself with dealing with the changes in employment in respect of safeguarded goods. In this case the figures are taken as from July 1 to June 30, for various reasons into which it is unnecessary for me to enter, but it is not a matter of controversy between us. It may make the figures somewhat different from those of the noble Earl opposite, but they are quite capable of adjustment and there is really in essence no difference between the two. In lace the net increase per year under Free Trade was 1 per cent; the average yearly increase in the number during the three years of Safeguarding was less almost by half—0.6 per cent. In cutlery the increase under Free Trade was 9.4 per cent; under Protection it was 0.4 per cent. Gas mantles and gloves were only comparatively small industries, and were not classified separately in the Ministry of Labour Gazette. and therefore no figures are available. Hardware and china are only small portions of their respective trades, and the Gazette only gives figures for the whole. It is impossible therefore to give any figures from the Gazette dealing with those two particular trades. Nor can I do anything with regard to buttons and hollowware, which were only safe-guarded[...] under the Budget of 1928.
§ I turn now to the question of prices. There are the classical examples of the rise in hardware and a number of other articles that have risen in price. There is, of course, one difficulty which I do not wish to disguise, and that is the question of how far there may be a difference in quality, although the price remains the same. That is a matter which any member of your Lordships' House can easily inquire into by asking questions either in the shops or in the domestic circle. A pair of silk stockings 990 might have been bought five years ago for 10s. and a pair of silk stockings may perhaps be bought for the same amount to-day, but it does not follow that the quality remains the same, that the weight to-day corresponds to that of the earlier pair, or that there is the same value in silk. It is probable that there is a considerable insertion of cotton in the feet and therefore the stockings are not comparable in value, whatever the price may be, to the pair of silk stockings bought for the same amount of money before the War and which contained more silk and less cotton. A pair of duplex gloves may be still bought for pre-Duty price, but the quality will be different. Scissors will be smaller. Jugs and hollowware may be bought for the sane price: but in each case they will be smaller articles for the same amount of money.
§ More than that, these Duties are chiefly being put on at a time of falling prices. All over the world prices have been falling and markets have been going down. Compare the cost of living in 1928 with what it was in 1924 and you will find that the cost of living has fallen in those four years from 181 to 167. It is obvious that the general cost of living has fallen and the cost of these articles ought to have fallen also—that is to say for goods of exactly the same quality. It is not sufficient to say that these goods can be bought at the same price as used to be paid for them. We ought to be certain not only that they are of the same quality, but that they have followed the course of world prices at the same time. We had an indication of the nature of the problem in something said by the Chancellor of the Exchequer in one of his Budget speeches. Speaking of the Duty on silk he said the Duty had very probably anticipated to a very large extent a reduction which otherwise would have reached the consumer in this country.
§ I venture to repeat the question as to whether Safeguarding and Protection are really the same thing. If they are the same thing I can understand their being combined in a single set of figures, but if they are not the same thing I think we are entitled to expect those who argue in favour of Safeguarding to confine their arguments in the future to figures which relate only to safeguarded 991 goods and not to protected goods. The Safeguarding policy of His Majesty's Government and also the Protective policy of His Majesty's Government have undoubtedly tended to increase that unemployment which we all deplore in this country. That is almost the inevitable result of anything of the kind. The object of an imports duty is to prevent things from coming into this country. The goods which come into this country generally come in British ships, and if fewer goods come in here in British ships, it follows that there is less employment for those employed on British ships and also less employment in the repair and building of ships and also in the docks to which our ships come. All these things must have their repercussion in places like the Clyde. These imports which come in and which it is sought to reduce in quantity, are paid for not by gold or cheques, but by goods which go out from this country, and if goods do not come in, then it is obvious that they are not paid for by goods which go out from here; therefore there is more unemployment because the people who would be making the goods which pay for the imports that come in are not employed. Once more you there find r second direction in which you swell the already growing amount of unemployment in the country.
§ Lastly, the goods going out from this country would mostly be carried in British ships, and if you have less goods going out as a result of this policy it follows that you further reduce the amount of work available to the British mercantile marine. It is obvious that is what must happen. Take the case of any of your Lordships who wish to go and buy a watch and chain. If, when you get into the shop, you find the price of the watch has gone up owing to the Duties, you are not able to afford to buy the chain at the same time, and the man who would have made the chain is kept out of work. Again you help to swell the tide of unemployment by raising the price of the watch. An instance of that kind is not directly responsible for immediate unemployment, but when that sort of thing is repeated in hundreds and thousands of cases up and down the country it can have no other effect except that of increasing unemployment. And the unemployment which takes place is, after 992 all, not necessarily in those particular trades but in other trades—the trades which make the goods that are exchanged for those in respect of which the Safeguarding Duties have already had some effect.
§ I know that some apologists for this policy speak of the War having made a great difference in this direction. They can understand us having been Free Traders before the War, but they do not understand altogether why we should be Free Traders to-day. I would point out to them that the laws of economics are just as true to-day as they were before the War. Not only are the laws of supply and demand the same, but the basic facts of human nature upon which the laws of economics depend are the same to-day as they were before the War. We see no reason why the consequences which in the past we know have been proved always to follow from the imposition of tariffs should not follow now when tariffs are put on, whether they are in the nature of Protection or of Safeguarding. In any case, I believe that these extraordinarily dull and wearisome figures which I have put before your Lordships this afternoon will on examination prove the Resolution which I have put before your Lordships and which, on a later date, I shall venture to press to a Division.
§ Moved to resolve, That the available figures relating to the articles which have been given a Duty under the Safeguarding White Paper procedure show that Safeguarding is a failure.—(Earl Beauchamp.)
§ THE EARL OF LUCANMy Lords, I notice that this debate, as happened on the occasion of the debate which was instituted last November by my noble friend Lord Arnold, has rather developed into a question of Free Trade and Protection. I am afraid I am not prepared to follow the noble Earl into a discussion of those subjects. The noble Earl has given us a great many figures. He has launched an attack, but he has launched it on a very narrow front. He said he was not prepared to deal with the whole of the articles which were subject to Duties, whether you call them Protective or not, and he has confined himself to those articles which come under Safeguarding Duties. His 993 Majesty's Government, on the other hand, claim that the question of Safeguarding must be regarded as a whole, and that special articles cannot be picked out here and there if the result of the scheme as a whole is to be judged.
The experience of the Board of Trade is that, on the whole, employment in many of the industries covered by these Duties has been satisfactory during the past year. There has been a noticeable increase especially in the motor, artificial silk, and leather glove industries. I acknowledge that the noble Earl has excluded those things, but there has been an increase in the number of workpeople employed in those industries and the fact that certain foreign concerns have been induced to establish factories in this country has led to the absorption of a large number of workers. Imports in general are new lower than before the Duties were imposed in many eases, and there has been a steady increase in the export trade. There does not seem to have been any advance in the prices of commodities, and in some cases they are lower. The articles which the noble Earl has enumerated as included under Safeguarding Duties are lace, cutlery, leather and fabric gloves, packing paper, translucent china, buttons and enamelled ware. Most of those industries were rapidly dwindling when the Duties were put on, and even though they have not been improved to the extent that was expected, I think we must assume that the effect of those Duties has been to stop that decline and that, so far the industries have benefited by the Safeguarding Duties.
As I say, I cannot follow the noble Earl fully into all the figures he gave, but he gave figures with regard to lace. I think that it will be within your Lord ships' recollection that the question of lace was very thoroughly dealt with in the debate last November by my noble friend the Earl of Plymouth who then answered for the Board of Trade. It is acknowledged that there has been a heavy fall in the re-export trade in lace. That fall is not due wholly to loss of trade, but to an entirely different thing. It is owing to the method of shipment. Before the Duties were put on France used to send lace to this country and it was sent by through bill of lading to the United States. Those figures were included in 994 our trade returns. Since the Duty was put on that lace, in order to save expense, has not been taken out of bond, but is now transhipped in bond and the figures therefore do not come into our trade returns. In addition to that there has been a change of fashion, I believe: not so much lace is used on garments as was used heretofore, and Americans do not buy as much lace either from France or from ourselves as they did.
I was wondering whether in dealing with the articles which come under Safeguarding Duties the noble Earl would get down to retail prices instead of only dealing with wholesale prices of cups and saucers and jugs. Perhaps the noble Earl is aware of a leaflet which has been widely circulated at recent by-elections. It was a rather misleading leaflet, I think, because it did not say what was the quality of the articles. I believe pictures were printed on the leaflet and prices were given of articles before the Duty was put on and after the Duty was put on. They were, as he says, fabric gloves: before the. Duty, 1s. 11½d., and after the Duty, 2s. 11½d.; cup and saucer: before the Duty, 6d., afterwards, 9½d.; jug: before the Duty, 9d., after the Duty, 1s. 3d. In one of these by-elections the Conservative candidate took the bull by the horns and went out shopping in the town, bought articles described in the leaflet and produced them on the platform at his meetings. He found he was able to buy fabric gloves at 1s. 11½d., which showed no increase, a cup and saucer for 5d., which was a halfpenny reduction, an enamelled pan for 1s. 8d. instead 'of 1s. 10d., or twopence reduction, a jug for 8½d., which is a halfpenny reduction, and scissors for 9d., which was the same price as before. He could not find an Italian alarm clock which was one of the articles quoted in the leaflet. The noble Earl discussed the prices of these particular articles, and I think we can very well claim that you can buy these articles now for the same price as you could before the Duties were put on.
As regards leather gloves he has admitted that prices have fallen by from 3 to 8 per cent. in spite of there having been a rise in the cost of the raw material. Fabric gloves, according to my information, have remained un- 995 changed in price since 1925, except in one or two lines in which there have been reductions. In china table ware there has been a reduction of 7½per cent. and 10 per cent. in the prices of certain kinds since the Duty was put on, while the prices of most other kinds have remained the same. My, information in regard to the price of wrapping paper differs from that of the noble Earl. The National Association of Packing and Wrapping Paper Manufacturers say that prices are now lower than in the first quarter of 1926, the reduction varying from 4 per cent. to 12½ per cent. The Inveresk Paper Company, one of the most important paper producers in Great Britain, have embarked on the production of kraft paper—it is derived. I believe, from the German word "kraft"—which is a particularly strong packing paper. They have embarked on that production since the Duty was put on, and have installed three new machines costing £1,250,000. In West Hartlepool an old paper mill has been reconstituted for the purpose of manufacturing this paper, and at Aylesford an old established paper concern has decided to instal a large plant for the manufacture of kraft paper, and will produce from 300 to 400 tons of this paper per week.
It is true that cutlery did not show very much more improvement, except in the case of safety razor blades. The most noticeable development is that, since the Duty, there has been an increase in the manufacture of these blades. In former years a large majority of the blades manufactured abroad, especially in America, were made from strip steel supplied from Sheffield. Since the Duty, many Sheffield firms have taken up the manufacture of these blades and one firm now reports having entered into a contract to send to America 124,000,000 wafer blades per annum. The Auto-Strop Safety Razor Company state that since December, 1925, their staff has been increased by 60 per cent., their factory space by 50 per cent., and their sales by 109 per cent. The export part of their trade has grown and, while there has been no increase in price, there have been a few reductions.
The noble Earl quoted the case of buttons, and I have reports from certain 996 firms. Messrs. Clarkson & Son, of Birmingham, pearl button manufacturers, say that foreign prices have decreased from 20 to 25 per cent., while English prices have kept the same level. More machines are being operated and employment is slowly increasing. Buttons, Ltd., Birmingham, report that foreign prices, which in some cases were slightly higher than ours, and in some slightly lower, show a tendency to drop, while English prices remain the same. This firm recently spent £10,000 on new machinery and the number of employed is increasing. Another firm has sold £67,000 worth of new machines for the manufacture of ivory buttons alone. Another firm reports that foreign prices are lower, but the Duty keeps English manufacturers well employed and English prices remain the same as the pre-Budget prices. A number of idle machines are now working and employment increased within a month of the Budget, while it was possible to close down for August Bank Holiday week on full pay for everybody, for the first time in the firm's existence.
The noble Earl has excluded motors from his criticism, otherwise I could enlarge upon the fact that firms such as Citroen and Renault have started factories in this country, while the Ford Company is floating a company of £7,000,000 capital and bringing a great deal of money into this country. On the average there has been an enormous reduction in prices and an increase of profits. In the case of British pianos, there has been a price reduction since June, 1928, in some twenty models of British pianos of something like 20 per cent. In regard to gas mantles, the noble Earl said a good deal about the arrangement with Germany but, so far as I understand, it is a perfectly fair arrangement. Since the imposition of the Duty an agreement for a division of markets has been reached between British manufacturers and the German Mantle Convention and some associated foreign manufacturers. Under this agreement the home market is, in so far as foreign makers participating in the agreement are concerned, preserved for British mantles. The imports of mantles have been greatly reduced. It appears that production during 1927 was somewhat lower than in 1926, and was lower again 997 in the first half of 1928, but this may be accounted for by the fact that, owing to the development of electric lighting, the consumption of gas mantles is decreasing. The British manufacturers also claim that the mantles now made in this country are stronger and last longer than those formerly in use.
I think that I have gone through all the articles that were subjected to Safeguarding Duties, and I venture to think that the figures and particulars that I have given entirely dispute and counter the statement of the noble Earl that Safeguarding has been a failure. I do not think that he has shown that any trades have been injured by Safeguarding. All our information tends to the contrary. It is impossible to contest the claim of His Majesty's Government that production has been increased, and that therefore there has been more employment. New factories have been set up in this country and the engineering industry has benefited accordingly. Imports of safeguarded goods have gone down while exports have gone up. There is a notable difference in the figures regarding goods subject to Safeguarding Duties and others. The retained imports of safeguarded goods in 1924 amounted in round figures to £48,000,000, and in 1928 they had gone down to £37,000,000. While imports have decreased in the case of safeguarded goods, in the case of all other wholly or mainly manufactured articles not safeguarded in 1924 the figure was roughly £217,000,000, and in 1928 it had risen to £254,000,000. In regard to safeguarded goods, exports have increased from £29,000,000 in 1924 to £38,000,000 in 1928, while in regard to other articles the figure for 1924 was £589,000,000, and it fell in 1928 to £540,000,000. His Majesty's Government, therefore, do not admit that Safeguarding is a failure, but claim that it has fulfilled the object for which it was instituted and that, without raising prices to the consumer, increased production and employment have been obtained and the general condition of those industries has been benefited.
§ LORD HUNSDON OF HUNSDONMy Lords, my noble friend has dealt with certain details that were mentioned by the noble Earl in his opening speech, but there are one or two particulars on which I think I can throw a little further light. 998 In the first place, the noble Earl made a great play with distinguishing Safeguarding from Protection. I should like to point out to your Lordships that, whether either Safeguarding or Protection prove to be a success or a failure, this is not due to the name or to the motive for which Import Duties were imposed. It is due entirely to the Duties themselves. Whether the Duties were imposed upon motor cars or upon fabric gloves, the effect would be precisely the same and the question that we have to consider is also the same.
The noble Earl spoke about lace, and I think my noble friend replied to him on that point. The marvel is that anybody produces lace at all, because of the restricted area, of ladies' dresses. There is nothing to hang the lace upon. As a matter of fact, I believe that the number of people employed in that industry is just the same as it was in 1925, although I think the noble Earl pointed out that the number of insured persons was much less in 1928 than at the earlier date. What the noble Earl did not know was that the basis upon which the insured persons were calculated was different. I am rather careful in what I say here because I quoted from an official Report in answer to Lord Arnold on one occasion, with regard to the number of people employed in the lace industry, and I found that the official Report was wrong. It was a very small matter, but I would like to take this opportunity of expressing my regret that I, or rather the official Report, made a mistake.
The noble Earl referred to cutlery. I understood him to say that there had been a decrease in the exports between certain dates. My figures show that there was a rise in the exports of 15 per cent. between 1925 and 1928. Then he spoke of fabric gloves. There again he said that there was a decrease in exports. That is perfectly true. There was a decrease of £21,000 in 1928, compared with 1925, but there was an increased production of from 21,000 dozen pairs of gloves to 60,000 dozen pairs of gloves in that period. There was an enormous increase in the home consumption of fabric gloves, and there were less available for export. I think that is the explanation.
I would like now to turn to two points which are really the foundation of the 999 Free Trade position, and also the foundation of the speech of the noble Earl. I will not go very much into detail, but I will try to shake the foundations of the noble Earl's speech: I think perhaps I might call them postulates, because Free Traders postulate two things. The first is that goods are always paid for by goods. If that is true there is no such thing as a balance of trade at all. There cannot be. They are always settled straight away by goods. Of course that is not so. During the greater part of last century we had a continuously favourable balance of trade. Of course I am talking of invisible as well as visible exports. We continuously sold more than we bought and adjusted the balance by lending money to foreign companies or institutions, or by investments abroad, with the result that we had accumulated by 1914 an enormous mass of foreign investments, which, as your Lordships will remember, stood us in extraordinarily good stead during the War, at a critical period. It is to that position of selling more than we buy that the Safeguarders wish us to return.
The other postulate, which was again referred to by the noble Earl, was that Import Duties must raise prices. Of course I admit at once, with regard to products that you cannot produce in this country at all, or to nothing like the extent which is necessary for our requirements, Import Duties should and would raise prices, though not to the full extent of the Duty. We are not, however, talking of such produce at all. Safeguarding does not refer to such produce at all, but only to goods which we can produce in this country to the full extent of our requirements, and it is very difficult to see how Import Duties can affect the price of goods in these circumstances, except when such Duties are first put on. What the Import Duty does is to shift the channel of sales; that is to say, it checks the incoming of foreign goods, and the place of those foreign goods is taken by British manufactures. That is the whole theory of Protection or Safeguarding, or whatever you like to call it. Owing to the manufacturer being able to increase his output he necessarily decreases the standing charges, and thus necessarily decreases his costs, and thus is able to reduce prices, and not only that, but by the reduction 1000 of price he is able to compete more freely with foreign goods in matters of export.
The noble Earl spoke, I think, as if prices had risen all through owing to the Import Duties. He mentioned among other things china. I heard something about egg-cups. Here is a statement made by the President of the Board of Trade on December 11, 1928. The President was asked to compare the prices of safeguarded goods before the imposition of the Duties and at the latest possible date afterwards. Here is his statement, but I will not trouble you with reading it at length. It appears that in regard to leather gloves prices fell between 1925 and 1927 generally by from 3 per cent. to 8 per cent. The Duty on leather gloves is 331 per cent., and so according to the noble Earl the price ought to have risen to that extent, but nevertheless it fell by from 3 to 8 per cent., despite a considerable rise in the price of the material from which these gloves are made. In the case of fabric gloves prices have remained generally unchanged since 1925, except in one or two lines where there has been a reduction. In the case of gas mantles prices were generally increased in 1926, directly after the Duties were imposed, but since then they have been reduced and some makes are now under, and others a little above, the 1925 level. Wrapping paper prices are now lower than in the first quarter of 1926, the reduction varying from 4 per cent. to 12½ per cent. With regard to china tableware, the prices show a reduction of between 7½ per cent. and 10 per cent. in certain kinds of chinaware since the imposition of the Duty, and in regard to other kinds prices are generally the same as they were immediately before the imposition of the Duty. With regard to the other safeguarded trades the Minister regrets that he is not in a position to give detailed information, but so far as he is aware the Duties have not led to an increase of prices for home-produced goods. The noble Earl makes a statement about prices, and I make another. I hope he will not think it discourteous when I say that our authority is nothing; the authority of the Board of Trade is the best and the only authority that we have.
I should like to say one word about the theory of Safeguarding: it is that manufacturers increase their output and so 1001 are able to reduce their costs. What the Free Traders always seem to omit is this, that whereas the manufacturer, with an Import Duty, has the security of his own market—that is to say, he is secure from foreign interference to a great extent—he is not secure from domestic interference. There is competition within the country itself, and that, therefore, keeps prices front rising; so the consumer is not injured. Really, I believe that the best test of the merits or demerits of these two rival systems of Safeguarding and Free Trade is to be found in the pace at which the manufactured exports of the various countries have increased. There again r should like to quote to your Lordships—because they are so extraordinarily valuable—the figures in a statement by the President of the Board of Trade on August 3 last.
He was asked to state the increase in manufactured exports of various countries from 1880 to 1927, and these are the figures that he gave. In the United Kingdom the increase in manufactured exports during those forty-seven years was 186 per cent. Now, you may say that is very satisfactory. But we will turn to France, which is an old country, just as we are, and highly developed, just as we are. The increase in their manufactured exports during those forty-seven years was 264 per cent. It is very difficult to understand how that can be, if they have the bad system of Protection ruling in that country. We turn to Germany. In Germany the increase was 252 per cent. I am bound to say that one reason for that must be that the rate of wages is lower in Germany, as it is also in France, than it is in this country. But let us turn to the United States, where the wages are a good deal higher. There the rate of increase during those forty-seven years was 2,099 per cent. You may say, of course, that the United States is a comparatively new country, that it has vast resources—which is perfectly true—and that you must not compare it with this country. If you were talking about the exports of produce I should say that that was perfectly right. But it is rather difficult to see why, if they have such a very bad fiscal system, they are able to increase their manufactured exports by 2,099 per cent., against our 186 per cent.
1002 I will give your Lordships the figures for Canada, because they may interest you. Canada exported practically no manufactured goods in 1880—£700,000 was the actual amount. They have increased their exports of manufactures by 10,371 per cent. That figure interested me, because, as it so happened, I came over from the United States with some Canadians in 1881, when they were just starting Protection in their country, and I, who was still under the influence of the doctrinaire teaching of my University, explained to them—but not nearly so well as the noble Earl to-day, though in the same sense—how very foolish they were. They said to me: "Well, we are almost entirely an agricultural country. We think we ought to have the complement of an urban population, with the greater culture that goes with it. We have great resources of water power and forest land. We are perfectly competent to make rough furiture,[...] so we started to do it. At once the United States clumped all their furniture over the border, and put all our manufacturers out of business. What would you do?" I said: "Put on the biggest Duty you can, and keep them out." Of course, they did; with the result that the export of their manufactures has increased over 10,000 per cent. I do not want to attach too much importance to figures. Of course, they all need to be thoroughly analysed and examined before you comment upon them. But I think, with those figures before your Lordships, I am justified in saying that there is just a chance that His Majesty's Government and all the rest of the civilised world may be right, and that the very select—and increasingly select—body of British Free Traders may be wrong.
§ LORD ARNOLDMy Lords, may I put a point of order to the noble Marquess? May we have any guidance as to what the course of this debate is to be? Is it intended to adjourn the debate until another day, and, if so, will the Government then at an early stage on that day make a statement in reply to the noble Earl, Lord Beauchamp?
§ THE LORD PRIVY SEAL (THE MARQUESS OF SALISBURY)My Lords, if I may venture to say so, that is hardly a point of order, and it is not a very regular way to interrupt the debate, in order to put a question of that kind. But I 1003 am perfectly willing to stretch a point, in order to help the noble Lord. I am in the hands of your Lordships. The debate is in progress, and until some noble Lord moves the adjournment of the debate it will go on, or, in the alternative, the Question will be put from the Woolsack, and the decision will be made. But, if some noble Lord moves the adjournment of the debate and it is desired that it should be adjourned, I should not resist the Motion. It is not my business to adjourn the debate.
§ LORD ARNOLDThere seems to be a little doubt as to what the course of events will be, and no information until quite recently has been given to our Bench as to exactly what was intended. I am not complaining, but that makes it rather difficult for us. I would like to make some observations now on the Motion of the noble Earl. I cannot help thinking that the noble Earl, Lord Lucan, who replied for the Government, is entitled to much sympathy. In all quarters of the House there is great regard and esteem for him, and I think it is scarcely fair to him, on the first occasion when he speaks in your Lordships' House for the Board of Trade, to give him the task of trying to defend these Safeguarding Duties, which is, of course, an impossible task, because the statements which were made by the noble Earl on my right [Lord Beauchamp] cannot be traversed, and were not traversed. No real attempt was made to shake a single one of them. In those circumstances, I feel that the noble Earl opposite has not been permitted to begin his career as spokesman for the Board of Trade under very favourable auspices.
The truth is that this debate has taken the expected course. We have had other Safeguarding debates during the last few months, and the result is always the same. When we get these matters discussed on the floor of your Lordships' House, with figures and statements given from this side of the House, the Government are utterly unable to substantiate the speeches made again and again by persons in very high authority, even from the Prime Minister downwards. What they do is what they have done to-day. They adopt the very old device of not replying to a single fact or figure such as the noble Earl put forward, but of replying to something else which was not advanced. That is what the Govern- 1004 ment are driven back upon. That is what has happened to-day. We have had the usual irrelevances and evasions.
Now, I say, as I have said before and as I shall go on saying unless and until the Government can bring forward something better than they have hitherto done, that these Safeguarding Duties have not merely been a failure in their operation but in certain respects an almost incredible failure. The figures of the noble Earl, Lord Beauchamp, have proved that. He pointed out—and this is the main case which Free Traders put as against the position of the Government—that if you take the safeguarded industries the exports in them have decreased, the imports have only been slightly checked, and the effect on employment even in the safeguarded industries themselves has scarcely been perceptible. Taking the effect on unemployment as a whole, I think it is as reasonably certain as anything can be (and the noble Earl developed this) that the general result has been adverse. I will not with any great confidence make the general point that during the operation of these Safeguarding Duties unemployment has been steadily rising; nevertheless, the fact remains that it has now reached a figure which is positively horrifying.
And we say, and we shall go on saying it because the Government have not disproved a single instance which has been brought forward—I brought forward several and the noble Earl, Lord Beauchamp, has brought forward several to-day—that the effect of these Duties has been to raise prices. That is our case. What do the Government say, what did the noble Earl, Lord Lucan, say, in reply? How did he meet this indictment, if I may so call it? The Government cannot deny the facts because the facts are there, based in practically every case upon official figures, or figures very carefully derived. The noble Earl did not deny, because he cannot deny, that exports in the safeguarded industries have decreased. He did not deny, because he cannot deny, that the flow of imports has only been slightly checked by those Duties.
He did not deny, because he cannot deny, that in the safeguarded industries the effect upon unemployment has been scarcely perceptible. In only one safe- 1005 guarded industry are there official figures about unemployment and that is lace, and when, at last, after a great deal of shuffling, of subterfuge and so forth, we got down to the final figures, we found that after the operation of these Duties for some years the effect upon the lace industry had been to increase employment by the monumental figure of 618!Taking into account everything that can be taken into account, the final official figure shows an increase of about 4 per cent, out of some 15,000 to 18,000 persons, and I believe there is reason to suppose that the increase is largely due to a change in fashion and a greater demand for certain lace products.
Again, as I have indicated, the noble Earl did not deny, because he cannot deny, that certain prices have been raised by the Safeguarding Duties. The case of the noble Earl, Lord Beauchamp, has been completely established and the only thing the Government can do is to do as they have clone before and as they go on doing—to try to bolster up an entirely unsustainable case by bringing in (the noble Earl, Lord Lucan, was doing it within half-a-minute of getting on to his feet) the statistics relating to motors and artificial silk. Those are not safeguarded industries. I have pointed out before—it cannot be denied and everybody knows it is true—that their prosperity is not due to the Safeguarding Duties. The artificial silk industry grew by leaps and bounds long before there were any of these Duties. The chief firm in the trade, at that time, almost the only firm in the trade, Courtaulds, did not want a Duty, they were against it.
The Safeguarding Duties are supposed to help depressed industries. Has anybody ever suggested that Courtaulds was a depressed industry? The Lord Chancellor attempted it because he made a speech in which he implied that motors and artificial silk were at one time threatened with extinction. Anything further from the fact it is difficult to imagine. The motor trade had B, period of great prosperity after Mr. Snowden, as a good Free Trader, had taken off the Duty, and that period will compare favourably with any other period. Everybody knows that the artificial silk trade and the motor trade are new trades catering for a huge popular demand, and the production which they put out is 1006 bound to grow whether there are Duties or whether there are no Duties. But we say that it is not right, that it is not fair and that it is not the proper way of conducting a controversy to bring in these statistics of non-safeguarded industries, to unite them with the others and then to say that the results are due to Safeguarding. It is not true, and I will give your Lordships an illustration which I think will prove it.
Supposing, for the sake of argument, that in 1923, when this Government was unhappily in office before, they had put a Safeguarding Duty on each of the various articles which go to make up wireless apparatus. I believe that as a matter of fact nearly all of them are free from Duty. I think valves conic in under licence but that does not affect my argument. From 1921 to 1923, when broadcasting was in its infancy, the output, of course, did not increase very greatly; but from 1923 to 1929 there has been a stupendous increase, as everybody knows. What would the Government have done had they followed my suggestion? They would have come forward and said: "Look what the Safeguarding Duties have done: in this case; see how this industry has grown on account of those Duties!" That is what they have done in regard to artificial silk and motors, and it is precisely the same point. I do not want to use language which is too strong, but I say that that is not fair, and in my opinion it is not a right nor honest method of conducting controversy.
We do not object, as Free Traders, to your bringing in artificial silk and motors because we are afraid or because there is something that we cannot reply to. That is not the reason why we object to your doing that. We object because the prosperity of those trades is demonstrably due to exceptional causes, to causes which, to some extent, will not continue permanently. Your Lordships know perfectly well that what I say is true, and that the prosperity of these industries is almost entirely due to the fact that they are new industries and cater, as I have said, for a huge popular demand. I say that it is wrong to include them in the way in which Government spokesmen include them and draw conclusions from those figures, because 1007 such conclusions are on an entirely unsustainable basis. That is why we object to those figures being introduced in this way.
I do not attach very great importance to this but I think it is worth while to mention it in passing. As a matter of fact the President of the Board of Trade distinctly said in another place that silk is not safeguarded; that the Silk Duty is not a Safeguarding Duty. The Parliamentary Secretary of the Ministry of Labour said virtually the same thing about the Motor Duty. Whether he said it or not, it is true that they were put on in 1915. I do not attach too much importance to that, but it makes the statement of the noble Earl, Lord Beauchamp, so technically correct that even the Government themselves admitted that these Duties were not Safeguarding Duties.
Let me turn now to the question of prices because it is about that, perhaps, that most controversy rages. We say—the noble Earl said it—that the Safeguarding Duties have raised prices. The Government deny it. The Prime Minister has denied it. The Lord Chancellor says: "We have done all this without raising prices." Only a few days ago the Minister of Health said the same thing. If that is so, why do not the Government make some adequate reply to the instances which are given to the con trary? The noble Earl, Lord Beauchamp, gave some to-day. I have given some time after time.
I have given specific instances in different industries. I said: "That was the price before; that is the price now." No attempt has ever been made from the Government Bench to meet a single one of those points, not the slightest attempt, except this afternoon the noble Earl said: "You can buy scissors for the same price." But they are not the same scissors; that is the point. You are not comparing like with like. The noble Earl said the Conservative candidate at Battersea bought a plate or a cup or whatever it was at such and such a price, which was no higher than was paid three years ago. But it is not the same cup. Even if it was bought at the same price, that does not prove that Safeguarding has not increased prices, because, having regard to the general fall 1008 in prices, it should be decidedly cheaper now. We do not say you cannot come forward and adduce instances of things being cheaper than they were three years ago, but what we say is that but for the Duty those things would be cheaper still. That is our point, and it cannot be denied.
There is not only the question of price, but there is also the question of a change in quality. I read a short quotation in your Lordships' House a few months ago from the Drapery Times—not a Labour organ—which said in so many words that Safeguarding Duties do affect prices and also affect quality. It is not a sufficient reply for the noble Earl to come forward and say: "You can buy a cup at such and such a price." The instances which I have given I have taken all the care I can to verify, and there is no reply. The price has been raised. Moreover, the Government, in that official reply of theirs from which Lord Hunsdon quoted, admit, certainly in one case, that prices have gone up and they practically admitted it in another case. A Question was put by a member in another place asking for all available information showing the effect of Safeguarding Duties on prices—all available information. It then turned out that there was practically no official information whatever.
The noble Lord, Lord Hunsdon, says that it is all very well for the noble Earl and myself to give figures, but that it is only the Board of Trade which knows. But it is the Board of Trade itself which, a very short time ago, stated in the House of Commons that there are no official figures, and this long reply giving all the available information comes to the same thing. The President of the Board of Trade says: "I understand that," or "It would appear," and so forth. Those are qualifications which do not appear in official replies in the ordinary way, and it shows there is something that they are not sure about. It shows there is something they feel they cannot defend. It shows that they must have a back door to get out by when they are driven against the wall. The fact is there are no official prices. What did the Lord Chancellor say? I put specific questions to him about prices because of a speech he had made, and all he said was that there was no need to deal with the points I put because the noble Earl, Lord Plymouth, had done so. 1009 As a matter of fact, the noble Earl, Lord Plymouth, had not done so, or even said a syllable about them. That is the way fiscal debates are conducted in your Lordships' House. What desperate straits a man in the high position of the Lord Chancellor must be in when he is reduced to so feeble a rejoinder—when he has to fall back on a statement like that. The Lord Chancellor makes a statement to the Primrose League, and when he is confronted with it on the floor of the House he does not attempt to reply but takes refuge in saying that the noble Earl, Lord Plymouth has replied. That is the way these debates are conducted.
We definitely say that prices have been affected. The noble Earl, Lord Lucan, quoted from the long rigmarole of the Board of Trade stating that prices of so and so had gone down, and that the prices of wrapping paper were down from 4 to 12½ per cent. in relation to previous prices. The noble Marquess said "Hear, hear." Yes; but if you take the comparative prices of the import articles, you will find that the prices ought to have gone down more in every case. When I say "the prices of import articles" I am speaking of the import prices before the Duty. When the Duty is put on the price is, of course, higher. Therefore, as a matter of fact, the long reply of the Board of Trade, when it is analysed, does not in the least degree substantiate what has been said by Ministers, and it shows how extraordinarily difficult it is for them to make any kind of a case when they are actually driven to it.
I would like to put a question to the noble Earl, Lord Lucan. It is a perfectly simple question, and a proper question to put to him. I would like to ask him this: If it is true that Safeguarding Duties do not raise prices, why do not the Government put a Duty on iron and steel which they are so strongly pressed to do by the big majority of their followers? I give way to him to reply to that question. Of course there is no reply. As a matter of fact the price will be raised by the Duty. The second question I would put to the noble Earl is this: Does he still adhere to the statement made by Ministers previously and made by him again to-day, that Safeguarding Duties have not increased prices? Again, no reply. I think 1010 silence makes a reply in my favour. Yet we have this perfectly definite statement made by persons in the highest authority.
Only a few days ago the Minister of Health made a speech—this was not some insignificant Under-Secretary but the Minister of Health—in which he said:—
In every case where one of the Safeguarding Duties has been put on the imports of foreign articles have decreased, the exports of British-made articles have increased, employment has gone up and prices have gone down.That speech really competes with the speech of the Lord Chancellor for containing in a small space a maximum amount of misstatement. Every one of these contentions of the Minister of Health is completely disposed of by the figures of the noble Earl on my right [Earl Beauchamp]. I do not go into that again; but those are the official figures which he gave. It is not true that the exports of British-made articles have increased. He says employment has gone up. There is only one case in which official figures can be brought to show that, and in that case it is so small as scarcely to be worth while taking into account. It is certainly not true that in every industry there Safeguarding Duties have been put on prices have gone down. Apart from that the effect of these Duties in checking imports into this country has been extraordinarily small.I say it is a wrong state of things, to use no stronger language, to have Ministers going up and down the country making these statements which, when they are challenged on the floor of Parliament, they cannot substantiate. The Lord Chancellor, in trying to substantiate his speech to which I have referred, brought in motor cars, silk and so forth, but even so he was wrong in the figures which he gave in his speech to the Primrose League. He was dealing, he said, with a three-year period and when challenged here we found he was dealing with a two-year period, and the only two-year period. I believe, which would have produced any result such as he gave. Any other two years would have produced different results. I asked why he did not bring his figures down to date and he said we had not yet completed 1928. But eleven months of 1928 had gone and if that year 1011 had been taken it would have destroyed his case. I said that even if you take matters which are not safeguarded, if it be true that Safeguarded Duties increase exports how is it the motor car exports for 1928 are down very considerably compared with 1927? To that, of course, he could not reply. And so I could go on.
Unless there is some new official information—we know as a matter of fact there cannot be, if there had been it would have been given—I contend that the case against these Duties has been very fully made out; in fact I shall go on saying, as I have done before, I think the results so far as Safeguarding is concerned have been pitifully disappointing. If that is not so I would like to put this to the noble Earl: If the Safeguarding Duties are the success which the Government claim, why is it that the Government do not put the full policy of Protection before the country Surely that is the right thing to do. If Safeguarding is this great success which they say why do they not do it? The General Election is coming. They say: "We will wait; we will not do anything about iron and steel; we will have an inquiry." Why not have that inquiry now? There is plenty of time. You could have it long before the General Election. The fact is the Government do not put Protection before the country because they dare not do so, because they know the country does not believe the statements which have been made about the success of Safeguarding. The country knows those statements are not true. The Government knows the country knows they are not true. That is why the country has no faith in the policy of Protection.
The Lord Chancellor talked glibly, the last time we discussed this matter here, about the follies of Free Trade. If that is his view is it a right thing for him to remain in a Government which purports to be a Free Trade Government? This is a very fundamental question, the fiscal system of the country. If he thinks that Free Trade is a system of folly, surely he ought to try to persuade the Government to do what I suggest, to put a full Protection policy before the country, or failing that he ought to leave the Government. The folly of Free Trade!I wonder what some of his great Conservative predecessors on the Woolsack would have said about a 1012 phrase like that. Personally hope he will go on making speeches like that. They do us a lot of good. We get tens of thousands of votes from them, and the more speeches of that kind that are made the better. Recent by-elections have shown what the country thinks of Safeguarding. A noble Lord laughs. Is that denied? The results of some of these by-elections are without precedent in the history of by-elections. In one or two of them the Government have lost nearly half of their vote as compared with 1921. Nothing of that sort has ever happened in the history of by-elections before. What happened in Bishop Auckland, a great industrial constituency? The Government candidate managed to poll about one vote in ten, and very nearly forfeited his deposit. The country does not believe in these fairy tales about the success of Safeguarding or about its being a cure for unemployment, because it knows perfectly well it is nothing of the sort.
When the time comes—and it cannot be very long delayed now—the Government candidates, at any rate in many industrial areas, will be nearly annihilated. Whether the Division comes today or next week as far as we are concerned we shall certainly support the noble Earl in the Lobby. Of course, we know that the Motion will be defeated, as many Motions from this side of the House are defeated, but we are accustomed to that result. It will not mean that the result of the Division will be any guide to the merits of the question, nor will it mean that the result of the Division will be any guide to the opinion of the electors.
§ Moved, That the debate be now adjourned.—(Lord Stanley of Alderley.)
§ THE MARQUESS OF SALISBURYMy Lords, the Government have no objection to that Motion. It was fully understood that if any noble Lords in any part of the House would prefer to have the debate adjourned, the Government would accede to their wishes. Therefore we shall not oppose this Motion.
§ EARL BEAUCHAMPMy Lords, I am quite willing to fall in with that decision, 1013 and I hope it will not be necessary to say that any date which is convenient to the noble Marquess will be convenient to us.
§ On Question, Motion agreed to, and debate adjourned accordingly.