§ LORD OLIVIER had the following Notice on the Paper—To call attention to the plight of the British Colonial sugar industry, and to ask His Majesty's Government for information upon the subject and invite a considered justification of the policy of His Majesty's Government in regard thereto, particularly in view of the contradictory reasons given in this House and in another place for inaction in regard to that industry, and for the increase of subsidy to the British beet sugar industry, its competitor, respectively; and to move for Papers.
§ The noble Lord said: My Lords, you have had your interest greatly excited by a subject which is perhaps of more interest to many of your Lordships than that upon which I desire to address you, and Lord Passfield has informed me that it is necessary for him to leave this House at no very distant hour. Therefore I am afraid that I shall have rather to curtail what I wish to put before your 353 Lordships on this matter, which I think raises more than immediate questions of our commercial policy generally. I have desired to call attention to the plight of our Colonial sugar industry, but I will curtail that part of my observations, because I think there, is no difference with regard to the facts between my noble friend and myself. Generally speaking the industry is suffering, as we have always told you it was bound to suffer, under present conditions. In some of the Islands the conditions are extremely severe and distressing, but are largely due to drought and to shortage of crops, and I will not deal at length with those places where the conditions are aggravated by drought and shortage of crops.
With regard to Barbados, that Island is now suffering, as we foretold, very severely from conditions which are described to me in a letter by a distinguished member of the commercial community, which I will read to your Lordships:
The situation locally is still very uncertain. The entire sugar crop has been disposed of to Canada at prices which net the factory about £8 8s. per ton. This of course means a heavy loss in practically all cases, particularly as the crop, owing to severe drought, has fallen short of last year's by about 30,000 tons, or a little more than one-third. … No arrangements have been made to assist the industry by the local Government up to the present. The only action taken has been to place before the Legislature certain measures for the relief of unemployment. Those involve the expenditure of about £5,000, and relate to work on roads, and repairs and improvements to elementary schools. It is understood that further measures are in contemplation. There is undoubtedly want and suffering among the labouring population, slightly mitigated by the fact that their chief imported food rice, biscuits, etc, are much lower in price than at this time last year. They are behaving wonderfully well under trying conditions, and there is no unrest up to the present. Whether this state of affairs will continue later on this year, when money received during the crop is completely exhausted, is a matter for conjecture.
The position among the plantation owners is very serious in many cases. Several estates are being put up for forced sale, and I doubt if any buyers will be found; probably mortgagees will be forced to take them over to protect themselves, and endeavour to make arrangements to carry on. In a large number of other cases the means of carrying on for another year has not yet been settled. Except in a few instances no actual abandonment of land has taken place. In Bridgetown trade is suffering considerably; deductions in salaries
among shop assistants, etc., has been made and many dismissals have occurred. It is among these at present that the distress is at its worst as they cannot find fresh employment. There is no means of their emigrating and they are compelled to live on charity. It goes against the grain very much for these people to have to beg, particularly as they meet with many refusals; the incomes of nearly every one being so much reduced that they cannot afford to help others.
Although in the Government estimates for the current year revenue is expected to quadrate expenditure, I am certain that those concerned have considerably underestimated the reduction in imports, which is bound to take place owing to the very much reduced spending power of all classes.
§ With regard to British Guiana, as Parliament is already aware it has been found necessary by the Secretary of State for the Colonies to make applications for liberal assistance for the Colony owing to the very severe distress which is now being experienced there. In both Barbados and British Guiana wages have been much reduced. In Trinidad and British Guiana they have had extraordinarily heavy crops owing to a favourable season and that will relieve the difficulties of those Colonies to a considerable extent, because where the chief difficulty is the cost of cultivation it helps very much when you have a crop which is 10 per cent, above the average. In Jamaica, where I have spent three months this year, the sugar industry is in very great difficulties, largely owing, or to a great extent owing, to the fact that by reason of the heavy duty upon it there is no market in this country for rum. There is severe distress all round these Colonies. It does not move me to be told that there is depression of trade and industry all over the world, because in a country like this we take care that the workers out of work shall not suffer actual deprivation, but in the West Indies no assistance that can be given can prevent severe suffering being experienced by the West Indian population. Certain Governments came to the assistance of the industry and gave it subsidies. This year again the Government of Jamaica is giving a subsidy to the sugar industry. Without that assistance the industry could not be carried on, even in the struggling manner in which it is being carried on.
§ We have appealed again and again to o the Government to give the West Indies 355 that slight assistance to tide them over their difficulty which was almost promised to us two years ago, and the easiest form in which we put our plea for that assistance was that there should be a slight increase in the Preference, that is to say, increase the Preference by about Is. a cwt. so that the West Indian Preference might be made equal to the Canadian Preference. The last occasion when that proposal was made was in the House of Commons, not very long ago, and at that time the reply given was that since the decision had been taken on the Report of the Sugar Commission of last year, that that assistance could not be given, nothing had occurred to alter the situation, and that the arguments which were good then are equally good now.
§ Now I come to what I call the inconsistency of the Government. In some respects it is an inconsistency which I applaud. They have acted inconsistently in their arguments and in their policy with regard, on the one hand, to the British Colonial industry and, on the other hand, to the British beet sugar industry; because in regard to the British beet sugar industry they have taken an entirely different attitude from their attitude on the West Indian and Mauritius industry. The Minister of Agriculture gave what, from his point of view, were very good reasons why assistance should be given again to the British beet sugar industry in just such a pinch and for just such reasons as are affecting the West Indian sugar industry. He used two arguments. I may say that, with the subsidy, the British sugar beet industry and the British West Indian sugar industry were on about equal terms. The British sugar beet industry gets a subsidy of 6s. 6d. a cwt. It cannot produce so economically as the British West Indian sugar industry, but with its subsidy of 6s. 6d. per cwt. it may be said to be on about equal terms. Well, we have established by law that it shall have a subsidy of 6s. 6d. a cwt. It may be a good policy, or it may not. Anyhow, that is the accepted position. When that position had become impaired by the fact that the price of sugar had fallen, as it has fallen within the last year, the British beet sugar industry came to the Chancellor of the Exchequer and persuaded him to take account of that fact, and Dr. Addison in another place said, in effect: "The price has fallen. That is a 356 reason for putting up the subsidy, so that they may compete on equal terms with the foreign producer."
§ That is precisely the argument that I have again and again put before my noble friends in this House—that since the Preference was fixed, since you gave your decision on the Sugar Commission's Report of last year, the price has fallen and your consumers in England are getting their sugar still more cheaply than the beggarly price at which they were getting it. You accept that argument in respect to the British beet sugar industry, but you have refused to accept it in regard to the West Indian and Colonial sugar industry. Again, Dr. Addison said that one reason why His Majesty's Government thought it desirable to ask for this additional 1s. 3d. a cwt. in the subsidy to the British beet sugar industry was that otherwise severe unemployment would befall. Very well, we told the British Government that severe unemployment would be caused in the West Indies, and it is being caused. With regard to the West Indies, the British Government have told us: "No, we cannot help that. If your people are starving, we will give them a little poor relief and unemployment works." There is a discrepancy in the policy, and it is that discrepancy which, rightly or wrongly, the West Indian and Colonial subjects of His Majesty complain of; because they say British commercial policy is determined apparently without the slightest regard to their interests.
§ When, you come to the policy of the production of sugar in this country, you take what, from our point of view, is a reasonable line. You say the British public has received its sugar at an enormous reduction, and it is only reasonable that a little of this should be given away in bringing up the subsidy. Unemployment has been produced in the British Colonies, and we have used that as an argument. You rejected that argument with regard to the British Colonies, but you accepted it with regard to this country. Therefore I want to know whether it is the policy of the Government that British Colonial interests are not to be taken account of in the commercial policy of this country.
§ I want to come next to a further aspect of this subject. We have been having a debate upon the question of forced labour, 357 and very sound quotations were made as to the attitude of the Labour Party with regard to forced labour and sweated labour in the past, and with regard to the position taken up by the International Labour Organisation on the subject of sweated labour. At the present time you are buying your sugar in England for less than one-half of what it costs to produce anywhere in the world. That is owing to mass over-production for speculative purposes, which has flooded the world with an enormous surplus of sugar. I should have liked to give your Lordships a rather careful account of what is happening in Cuba. The state of Cuba is terrible. The Island is in a state of seething unrest, complete unemployment. All the Jamaicans and others who used to work in Cuba have been turned out because there is not enough employment for their own people, and nobody is getting paid for the work they do. I read a recent account of Cuba by Mr. Raymond Leslie Buell, a very well known American economist, who has just visited there. He says people are not getting paid at all for their canes, not getting more than the cost of transport; for, he says, owing to the fact that Cuba has been parcelled out into large factory areas, the Cuban farmer, who used to be a, small cultivator, has become practically a forced labourer for the factory. He has to supply his canes there, he cannot supply them anywhere else; and he gets paid no more for them than the cost of cutting and transport.
§ That is to say that the American exploitation of Cuba has, in Mr. Buell's words, succeeded in reducing the Cuban colons into the position of serfs tied to the soil, and working for practically no adequate remuneration at all. That is a sweating system, and I have again and again appealed to my colleagues to take into consideration whether it is decent for the British public to buy sugar much below cost price under a system which in Cuba, Java, and elsewhere is reducing the population to this condition of bond slaves working for a very small pittance.
§ I say it is a disreputable policy for a Government to encourage. But they say: "We want sugar to reach the consumer in the cheapest possible manner." Again and again, they have said: "It is our policy not to tax sugar. We want free food." Are you aware of what the 358 present price of sugar is? The present price of sugar in grocers' shops, is 2½d. per lb. Do you know what is the price of the sugar itself, and what is the Duty? The price of the sugar itself is 1¼d, and 1¼d. represents the Duty. This Government which refuses to tax food is, therefore, taxing the food of the people. We have again and again told them: "Reduce your duty by a halfpenny per lb., and you can still give us a farthing per lb. and pay us a decent price for our sugar." But no! they profess that they must not tax food; they profess that they must not sweat labour, and they refuse to give to Colonial producers a very small fraction of the enormous benefit which consumers in England are getting from the ridiculous price of sugar. I have said that before and I am sorry to have to repeat it.
§ The final point that I wish to raise is this. I want to hear some considered justification of the attitude of His Majesty's Government in this matter. I must remind your Lordships that we had this controversy about getting cheap sugar for the British public a good many years ago while we were still suffering from foreign bounty-fed sugar. It was then decided by the Government of which Mr. Joseph Chamberlain was a member, that this was not a proper policy and that the Colonies ought to be considered. Then ensued the negotiations which led to the Brussels Convention and the menace of foreign bounty-fed sugar was done away with. The Colonial members of this Empire have always held that that was a sound and proper policy. They say now that it is not a sound and proper policy that is being pursued and that the Colonial Office, whose constituents they are—they have no special representatives in Parliament-ought to keep up their end, and insist that they should be considered in relation to British commercial policy as well as the consumers of this country. That is what they claim.
§ I was very much impressed and interested to hear my noble friend a few nights ago at a dinner at the Corona Club, talking very soundly, as I thought, of how great an advantage it would be to have one Imperial Colonial service, the officers of which could be freely exchanged between one Colony and another 359 without feeling that they belonged to a Colony, but that they belonged, in fact, to the Empire. Some Colonies are always a little jealous of such a policy, because they say: "We are developing ourselves and we like to be able to produce and train our own officers." If anything could induce them to take a more favourable view of that administratively sound proposal it would be if it were definitely considered and recognised as being the duty of His Majesty's Government in dealing with the commercial policy of this country, to take into account the commercial interests of the Colonies. So long as, on the one hand, the Imperial Government says, "No, we cannot consider your producers at all," and, on the other hand, "We would like to have an Imperial Colonial service," so long will you have a great reluctance on the part of the Colonies to enter into more sympathetic relations with this country.
§ They all desire to come into more sympathetic relations with this country. Communications are becoming more and more rapid. The Imperial sentiment, if I may so call it, in the British Colonies is steadily strengthening; but the thing that disgusts and disheartens them is that when a Party wants cheap votes by talking about taxes on food their interests are thrown to the wind and they are simply regarded as parts of the Empire for which the Colonial Office has no special responsibility. The position is not remedied by saying that you will give a little assistance for industries and so on. Such things do not touch the matter.
§ Finally, I want to know what, if anything, His Majesty's Government have done on the recommendation I ventured to make to them very strongly, as Mr. Chamberlain did before, that they should take some action to secure an international consideration of this question of dumping. The practice of dumping with regard to sugar is developing to a more ridiculous extent than with regard to any other commodity in the world. Surely His Majesty's Government might have taken some action on that suggestion and called an international conference on the subject of sugar? No! I do not know whether anything was done but nothing has transpired. Action was left to be taken in the matter by Mr. Chadbourne, an American financier who represented 360 American and Canadian financial interests in Cuba and elsewhere. He set the ball rolling and went round to the organised sugar industries of the world and to different Governments. He has succeeded in getting a plan agreed to by Cuba, Java, Germany, Czecho-Slovakia and some other nations and by the associated sugar industries of all those nations, that they will put a certain amount of the enormous surplus of sugar which now exists in the world into cold storage and dole it out in five years by instalments. Also that they will restrict their production in Cuba and Java to a certain extent.
§ When those negotiations were proceeding the West Indian Committee wrote several times to the Colonial Office begging and urging His Majesty's Government to show some kind of interest in this very important movement and to make some kind of motion about coming into it as the German, Czecho-Slovakian and other Governments had done. I asked what had happened in regard to that and I was told that the West Indian Committee had never had any answer to any of those letters from the Secretary of State, not even an acknowledgment of them. I should like to know whether anything was done in regard to the Chadbourne plan. Further, whether anything was done regarding an international concordat about foreign bounties and dumping. I should like some information on those subjects. It is a curious thing if when the West Indies and the Colonies asked His Majesty's Government to take that international action the would not do it; but when the beet sugar industry, who have votes, asked them to take action with regard to the beet industry, Dr. Addison, the Minister of Agriculture, was able to put up a very good argument on behalf of the Government in favour of it.
§ I have tried to be as brief as I can, and I think the points that I have put have not been the less telling on that account, because I have called attention to the different arguments that are used in dealing with West Indian and1 Mauritius matters and in dealing with the beet sugar industry, and I have called attention, as I hope, to the differences in policy. I want to emphasise the very great and bitter feeling that has been created in all these Colonies against the 361 Government that so entirely neglects their productive interests. It is a very serious Imperial matter. I have been all round these Colonies lately, I have been through the principal among them twice, in the last two years, and I have been immensely gratified at their progress both in energy and in what I might call the Imperial spirit. They are most desirous of strengthening the Imperial connection, but they are constantly disheartened by the weak, flabby, inconsistent treatment of their interests as compared with the treatment of the interests of persons who can command the ear of the Government. I have put both of my points to the noble Lord. I gave him notice of both of them beforehand, and, as a matter of form, I beg to move.
§ THE SECRETARY OF STATE FOE THE COLONIES (LORD PASSFIELD)
My Lord, I ought to apologise to the House for answering my noble friend at once because I must confess that I have an important official engagement to-night which I cannot get out of and which I should be very glad if I could, but it is a duty. I had contemplated that we should have been able to devote the whole of the sitting to this particular question. I will answer as fully as the time permits what my noble friend has put to me. Of course I do not at all complain of his having raised the question again because, as he says, the plight of the West Indies and of all the sugar Colonies is indeed very serious. I am glad to tell your Lordships that it is perhaps not quite so serious as the noble Lord feared eighteen months ago—not yet quite so serious. At that time, your Lordships will remember, we were told there was a prospect that the whole industry would go out and would come to an end, and that we should find on our hands these Colonies absolutely destitute and bankrupt.
I am glad to report that taking the West Indies, in Trinidad, British Guiana, and St. Kitts there has been no reduction in the acreage under cultivation. No doubt those who are producing sugar are doing very badly, but they have not gone out of cultivation. They find it better, quite rightly from an economic point of view, to go on even at no profit, or even making a loss, rather than shut down altogether. Of course they cannot 362 go on doing that indefinitely. But in Trinidad, British Guiana and St. Kitts there is no reduction of the acreage under cultivation. In Jamaica the reduction has been about 5 per cent., and in St. Lucia it is email. In Antigua, which is one of the worst off in that respect, there has been a reduction of as much as 13 per cent.—that is to say where eight acres were cultivated before there are now only seven. That is the most serious case from the point of reduction of cultivation, and that means that whilst wages have fallen there has not yet been that amount of unemployment which we had feared. I may mention also—because my noble friend refers only to the West Indies—that we have to take account of other places. There is Mauritius. In Mauritius also the area under cane has been maintained in the same way as, mostly, in the West Indies. Mauritius had a special calamity lately in the great hurricane to which I will refer later. Then we turn to Fiji. There has been no reduction in the area of planting for 1931–1932. So that there has not been that considerable diminution in the industry that was at one time feared.
The noble Lord asked me what was the policy of His Majesty's Government. The policy which has been pressed upon us by the noble Lord, and by the West Indies, and, generally speaking, by most of those connected with the industry, has been to deal with the problem by one uniform measure, and indeed by one specific measure—namely, an increase in the Preference which is given, which is in the nature of a subsidy from this country. That is the one thing that they have wanted. Now I have to point out to your Lordships that His Majesty's Government are not prepared to adopt that policy. I would suggest to the noble Lord, and to any of your Lordships who care to consider the economics of the question, that when you have an industry carried on in a great many different places, under conditions differing very considerably one from the other, and also with the actual plight of the industry differing in the different places, so that in some cases they are suffering hardly at all whilst in others they are suffering a very great deal, no uniform policy is a wise one.
His Majesty's Government did not adopt the policy of giving increased 363 Preferences. I would like to point out that what was called lately increase of Preference means a direct gift from the Chancellor of the Exchequer, and, practically, it is an increase of the expenditure of His Majesty's Government in this country. The right thing to do, the noble Lord suggested, was to give that increased Preference equally to all the different sugar producers in the Empire, but in any case your Lordships must note that it would have meant an increased expenditure by the Government. I wish to ask whether there is any Party in this House, or in another place, which is deliberately going in for a policy of increasing the Government expenditure in this respect or in any other respect. At any rate His Majesty's Government refuse to adopt that policy with regard to the sugar industry. Their policy has been, in the terrible plight into which these sugar Colonies have fallen, to deal with each place separately and differently, according to its need and according to its circumstances.
His Majesty's Government have not opposed additional subsidies to the industry where the locality could itself find a subsidy. In Jamaica and in Trinidad, as the noble Lord has pointed out, a temporary subsidy has been given to the industry out of the local funds. Those Colonies were fortunate enough to be able to afford it. In the other places there were no local funds available, and some other expedient had to be used. In those places the policy of the Government has been to deal with the emergency according to its nature. The particular emergency in Mauritius, for instance, has been due to the coming of this hurricane on the top of the sugar depression. In that case the best policy seemed to be to guarantee a loan by this Government of £750,000 in order to remedy the damage and relieve the distress due in particular to the hurricane; but, of course, the intensity of the distress was owing to the fact that the sugar growing had not been paying. The area under cultivation has not been reduced, and, therefore, the unemployment has not yet become severe, but the hurricane has upset everything.
Other places have other needs. British Guiana is the worst off, although they have had a good sugar crop, but they are the worst off owing to the amount of 364 unemployment. There, as your Lordships know, this Government has given very large financial aid in the direction partly of a direct gift, a grant-in-aid, and partly by loan for executing various public works of utility. That is what has been done in British Guiana. Similarly, taking each Colony one after the other, the immediate need has been met in the way most appropriate to the particular circumstances of that Colony. That has been the policy of the Government, and I am glad to say that it has been possible to make some little beginning in the direction the noble Lord who raised the question is specially concerned with; that is, of getting started alternative products and peasant settlements in particular Islands. I cannot go into the details of that now. That has been the policy, and I am unrepentant about it.
I do not think that an increased Preference was a wise way to deal with the matter, and I do not think that any uniform action was a wise way to deal with it. I think the action taken by the Government of dealing with the circumstances of each place according to those circumstances, sometimes by guaranteeing a loan, sometimes by a large grant-in-aid, sometimes by grants from the Colonial Development Fund for public works of utility and public improvements of one sort or another, making a long string of grants for all sorts of public purposes, has been the right policy. When the noble Lord says that the slight assistance that was almost promised two years ago has been denied, I am not aware what was promised in that respect. Certainly there never was any promise made about an increased Preference or any additional subsidy or anything of that kind.
§ LORD OLIVIER
I am referring to the statement of the Chancellor of the Exchequer that he was seeing what could be done to help to tide them over, and was considering recommendations to tide them over.
§ LORD PASSFIELD
I have been explaining what the Government have tried to do. This is only an attack on Government policy. That policy has been to deal in these various ways with the circumstances of each place as far as it has been possible to do so. The noble Lord—this has been the special purpose of the discussion to-night—declares that the Government have taken an entirely 365 different idea with regard to the sugar beet production in this country from that which it takes with regard to the sugar industry in the West Indies. I will only say that that is in accordance with the Government policy of dealing with each of these localities according to its specific circumstances and its specific needs. It so happens that the circumstances of beet sugar in this country are different from the circumstances of cane sugar in the West Indies.
I would like to remind the noble Lord that if two years ago the question had been not merely the low price of sugar, but coupled with that low price of sugar the reduction of the subsidy or the Preference by half at one fell swoop, the Colonies would have come with an even greater complaint to His Majesty's Government, and they would have protested not so much against the price of sugar, but with all their might against the reduction of the subsidy at that moment by one-half. That was the position with regard to beet sugar. The fall in the price of sugar fell upon them and the West Indian producers alike, but in the case of the West Indian planters His Majesty's Government did not reduce the subsidy or the Preference. On the contrary, the Chancellor of the Exchequer undertook first of all that so long as the Duty remained the Preference should certainly remain untouched. Then, very shortly afterwards, at the Imperial Conference he went further and said that whilst he could not pledge future Parliaments, he was prepared to promise that the Duty and the subsidy, the Preference, should remain untouched for three years or pending the outcome of the suggested Conference at Ottawa. He would say nothing further about the future.
In the case of beet sugar in this country, under the terms of the Sugar Subsidy Act, 1925—not in the time of the Labour Government, but in 1925—the subsidy was to be reduced from 13s. in 1930–31 to 6s. 6d. in 1931–32, 1932–33 and 1933–34. Not only did the price of sugar fall, but in addition the subsidy was cut in half. As the policy was to deal with each sugar-producing place according to its special circumstances and special needs, the Government did not apply the same policy where the subsidy was cut in half as they did to the other 366 sugar producers where the subsidy was maintained at its full amount. The reduction was from 13s. to 6s. 6d. but the Chancellor of the Exchequer saw lit to concede, in addition to 6s. 6d., 1s. 3d. That is to say, he allowed the subsidy to be reduced not from 13s. to 6s. 6d., but to 7s. 9d. He granted that not in order to diminish the loss to the producers of sugar but under the distinct understanding, the distinct arrangement, that the whole of that extra amount of over £200,000—I think it was £225,000— should be passed on to the farmers and in that way to the labourers. Whether that was right or not I leave your Lordships to consider—the noble Lord says he approves of it—but at any rate it is the policy of dealing with each sugar-producing place according to its special needs and not according to any one uniform plan.
It seems to me that that is certainly wise and I would like to point out that this extra 1s. 3d. which is given to the English sugar industry is not given by any increase in price. It is given out of the Exchequer. That means that noble Lords will feel it in their Income Tax and Super-Tax. My view is that it is in that way that help had better be given rather than by any fiscal device. That is an arguable point, but at any rate the Government have been consistent in this matter as between the different sugar producers and in its policy of dealing with each sugar area according to its particular circumstances.
I must pass on, I am sorry to say, quickly. The noble Lord complained that the condition of Cuba was getting desperate. I think it is true that the condition of Cuba is getting desperate, but what does the noble Lord propose to do about it? Cuba is not under our protection. It is not our responsibility and I am afraid I know of no means by which we. can deal with the mad capitalist production of the American speculator to which the noble. Lord referred. The only way would be to have some change of system.
§ LORD OLIVIER
If I may interrupt the noble Lord, he seems to be going a little off the point. I did not say that he should do anything for Cuba. What I said was that it was a disgraceful thing that a Labour Government subscribing to the principles of the International 367 Labour Organisation should be importing goods sweated as goods are sweated in Cuba. That was my argument.
§ LORD PASSFIELD
The argument is, I suppose, that we import sugar. I cannot say that I know where the sugar comes from, but I rather suspect that not much sugar comes to us from Cuba. As a matter of fact, the import of Empire sugar into this country is now enormously greater than it was twenty or thirty yeans ago. We are increasingly drawing sugar from Empire sources, and less and less from Cuba and other sources. If I could alter the terrible state of Cuba I would do so, but I am afraid it can only be altered by a greatly changed system and by a greater planning of production than we are likely to get from the United States.
The most serious point perhaps was that the noble Lord complained that the commercial interests of the Crown Colonies were not considered by His Majesty's Government. I do not think the noble Lord is quite warranted in saying that. He does not quite know what has been happening. If he means that there has been no fiscal change, no attempt to foster the industries of the Crown Colonies by some new fiscal arrangement, that is perfectly true. But the principles of Preference have been adopted by nearly all the Crown Colonies without any let or hindrance by His Majesty's present Government, and the Government have not interfered to cause the Crown Colonies to give up those principles of Preference in any way whatsoever. We have let them do as they like in that matter. I can only say that a large part of the attention of the Colonial Office is devoted to trying to foster the commercial interests of the Crown Colonies not in the particular way of additional Preference, which some people seem to concentrate on, but in all sorts of ways. The noble Lord referred to the great advance in communications. I think that the biggest commercial interest of the Crown Colonies is certainly that of the education of their people, which we believe would lead to much greater production than at present takes place. That is one of the big necessities which I commend to the noble Lord—the question of education in the Crown Colonies. It is really a much bigger commercial in- 368 terest than anything which is to be gained by Customs tariffs.
Finally, there is the suggestion that we have not managed to get more international action with regard to sugar. I can only deplore with the noble Lord that there has been such delay in getting anything done about sugar, but I do not feel that the Government have been to blame in the matter. We have had to pursue a policy which is calculated, as we thought, to bring about international action as quickly as possible and that did not mean calling a sugar conference and getting everything turned down and rejected as we had reason to believe would be the case. It meant lying low and fostering things and not claiming credit for it. I am glad to say some steps have been made in that direction—for instance, the Chadbourne plan. The West Indies apparently ask why did we not come into that. We might probably have gone into it with calamitous results. I venture to think that the Government have pursued the right course of doing what was possible to bring people round to that idea without actually butting in and insisting on forcing the pace or even taking the lead.
The British Government have not even become a constituent part of the agreement, because we were not invited. It is just as well that we were not. We have got over a lot of jealousy and difficulty. We were not invited because the British Empire is not an exporter of sugar; the Empire, on balance, is an importer of sugar. Most of the exporting nations have gone into the agreement, and the sugar producers have agreed, with the consent of their Governments, to a limitation of the export of sugar, on the one hand, for the next five years, in order to reduce world over-production, and, on the other, to a special arrangement for putting into cold storage the world's accumulated stocks of sugar in order that the price may not be depressed. This will take a little time to have its effect, but it is common knowledge that the price has gone up by something like 20 per cent, since this agreement came into effect. The influence on the market has been such that I hope to see a slow rise in the price of sugar in the course of a few years. Those who are in charge of the agreement do not want a spec- 369 tacular rise in price, because that would lead to the renewal of the over-production from which the world is now suffering. They look to see a steady rise from the present price of 6s. 4d. a cwt., or thereabouts.
That is not the only thing that has been done internationally. Attempts have been made to see what could be done in the way of getting the nations to agree to some action for regulating the production, or at any rate the export, of sugar. The Chadbourne plan is proving a very promising way to a conclusion, and a very much better way than the Governments of the world could have attempted, because it has come from the associated producers in the several countries. We might have felt bound to take a hand in the game but, as a matter of fact, I do not believe it was possible to have brought off an International Convention of greater value or practical efficacy than that which has now taken place. I do not know what better thing could have been done. It will not remove the distress of the West Indies. It will not apply to them, but it follows the only course which, in my judgment, was useful—namely, to secure a concerted limitation of export by all the sugar-producing countries. They did not ask the West Indies to come in because the amount which the West Indies produce, though important to themselves, is small in relation to the whole world's production. They did not bother about them, any more than about Mauritius and Fiji.
The West Indies stand to gain all that could be gained out of the Convention without losing even the advantage of the limitation of output which is imposed on the other countries. I do not think we could have improved on that. It is the best possible arrangement for the West Indies and the Empire that could have been come to. I rejoice that it has been come to. I have not the honour of the acquaintance of Mr. Chadbourne, but I should like to give him a, laurel wreath for having brought off an exceedingly difficult task. I have endeavoured to answer my noble friend's Question, and I am only sorry that circumstances have cut short this debate so seriously. I will not take up any more time. I am sorry that there are no more Papers, but we will take care to publish future reports upon the state of things in the West 370 Indies from time to time as they accumulate. I undertake that, and I hope the noble Lord will not insist upon having Papers now.
My Lords, I regret that the noble Lord who has just spoken is not able to remain in his place, but I quite appreciate the reason why he has to leave. I regret it especially because there are one or two points that I wish to raise outside those that have been dealt with by the noble Lord, Lord Olivier. We on this side of the House are very grateful indeed to Lord Olivier for raising this question once more. I felt, as I read the noble. Lord's. Motion, that he had wandered into a rather dangerous path in the way the Motion was drawn, and subsequently, as I listened to his speech, I felt also that he was going along a path that might lead us into even greater difficulties in the West Indies than those in which we find ourselves to-day. I hope the. noble Lord, with whom I have been associated for many years on this subject, will pardon me for what I am going to say, but I speak in the full belief that the method of dealing with this matter must be a method applied to the Colonies themselves, and not one that mixes them up with the question of sugar production in this country.
I am bound to say that I think it is wrong to play off, if I may put it in that way, the British sugar beet question against the Colonial sugar question. There may be matters that are applicable to both, but in this country we have our problems, just as the Colonies have their problems, and, so far as the British sugar beet industry is concerned, I think that the Government are bound to regard it from the point of view of this country, and largely apart from any issues that may arise in connection with the Colonial sugar industry. In making this remark I hope that those in the West Indies and Mauritius—(and I speak more particularly for the West Indies, which I know better and in connection with which I hold a somewhat important position even today)—I hope they will not feel that I am going beyond proper bounds. They are absolutely loyal and ready to respond to anything that His Majesty's Government can do for them, but I have never heard anyone connected with the West Indies suggest that, because something 371 is done for the British beet sugar industry, something must necessarily be done for the Colonial sugar industry.
I venture to suggest that there is room for both the British beet sugar industry and the Colonial cane sugar industry in the provision of sugar in this country. To-day we are consuming nearly 2,000,000 tons of sugar, and of that amount some 500,000 tons are produced in this country in the form of beet sugar, whilst some 700,000 tons are imported from Colonial sources, leaving roughly 700,000 tons to tome from foreign countries. If that is the case, is it not far better for us to consider the question of beet sugar from the point of view of this country and that of cane sugar from the point of view of the Colonies? If, for instance, the Chancellor of the Exchequer, in his Budget two months ago, instead of putting an additional tax on petrol had placed an additional tax on sugar and, at the same time, granted an increased Preference to Colonial sugar, that solution, while a partial solution and not a whole solution, would have been found to have partially solved the difficulty which exists in the West Indies and in Mauritius to-day.
We have heard a great deal about the United States of America, but I should like to point as well to what France has done for her Colonies. France, within the last few months, I think, and certainly within the last year, has practically entered into a state of free trade with her Colonies so far as sugar and other tropical products are concerned. We have here a practical example of what is called Empire Free Trade as between France and her Colonies, with the result that the French Colonies in the West Indies, Guadaloupe and the other Islands, and Madagascar and so on, are now in a far more prosperous condition than any of our islands which lie alongside.
It is because His Majesty's Government will not change their fiscal policy that they are unable to deal with this matter, and indeed unable to deal with any Colonial or Dominion question today. Lord Passfield admitted it just now. He said that they had done everything they could outside a change in their fiscal policy; and to what has it amounted? It has amounted to giving doles, just as doles are given in this country as a panacea for unemployment.
372 The Government are to-day giving doles in the West Indies and helping them to create unproductive public works.
The continued fetish of the Government is their belief in free imports and cheapness at any price, whether from forced labour, as we heard a short time ago, or anything else. That it is which is absolutely obsessing them, and which is the ruination of our association with our Colonies and Dominions to-day. The United States of America have just made a great and generous gesture to the world, and if President Hoover's proposal is accepted by the nations it will help the world to make a fresh economic start. This country, however, will still be left with its domestic difficulties, with its economic troubles, with its Budget deficit and its unemployment. Even with Mr. Hoover's proposal it will have to find an additional £10,000,000 in respect of repayments by the Dominions to this country, and how is it going to do this? It makes it all the more necessary to stimulate our trade with our Colonies and Dominions, a trade of which we are sure if we will only enter into proper arrangements with them. It is only in that way that we are going to get out of these difficulties.
I do not know why it is that Great Britain should be the only country which believes in doles, and hands out nothing but doles in this country and to her Colonies. We hand them out until the inhabitants of those Colonies consider themselves almost unfortunate to have been born under the British Flag and look with longing eyes—to my knowledge they do in the West Indies—to the Colonies to the east and west of them, under the French and American Flags, because those Colonies have received from their Governments certain advantages which have created more or less a cure for their ills, whilst all we do is to give our Colonies doles or assist them with loans, which give them only some ephemeral benefit. I do not wish to detain the House at this late hour, and will only conclude by saying that for several centuries these people in the West Indies and Mauritius have been loyal subjects of the Crown. They have served this country to the best of their ability, and I think it is for us to see that in these hard days of poverty and despair we do not let them down.
§ THE EARL OF PLYMOUTH
My Lords, I do not wish to detain the House for more than a very few moments at this hour of the evening, but I do think that something should be said from this Bench to express how very strongly we feel upon this subject; and I should like to say a few words on the general aspect of the matter which Lord Olivier has raised once again. I do so not because I think that there is anything very new to be said upon the subject, but for the reason that if we go on hammering away it is just possible that we may, in time, get the Government to move, though I do not pretend to be very sanguine upon the point. It would appear, and I am confirmed in that belief by what Lord Passfield said this evening, that the Government have irrevocably made up their minds that however much money they spend on other matters they do not intend to spend enough money to be of any use to the sugar-producing Colonies at the present moment. Lord Passfield rather prided himself upon the fact that the Government were not dealing with this matter as a whole, but were dealing with the separate sugar-producing areas separately according to their circumstances. My complaint is that they are not dealing with this question at all, so far as our Colonies are concerned. They have done nothing which has been in any way of material help to them in the difficulties in which they find themselves.
This subject has been so thoroughly discussed on numerous occasions that I do not intend to repent the old arguments or to go into details, but for the purpose of putting my short argument I would like to explain the position as I sec it at the present moment. Owing to overproduction of sugar throughout the world during recent years there has been an enormous fall in the price of sugar. It is impossible for producers of sugar in our Colonies to obtain profitable prices for their sugar, and in fact they are probably losing money heavily on every ton of sugar manufactured. And this position is bound to persist unless one of two things happens—unless, in the first place, there is a very rapid change in world conditions, which I think everybody who has studied this subject agrees is not at all likely at the present moment, 374 or unless, in the second place, the Government do something for our Colonies, and I am afraid we must agree that that is a more unlikely contingency still. Unless either of these two things happens, then it is absolutely certain that the sugar estates in the West Indies will gradually go out of cultivation—not all at once, naturally, but they are bound gradually to go out of cultivation, as they cannot compete in present conditions; and that great industry, upon which practically the whole of the population of the West Indies, both employers and employed, depends, will gradually be ruined. There really can be no two opinions on that point, and, as far as I can see, it is only a question of time and of how long they can continue to hang on.
Well, the Government apparently refuse to move, and one of the reasons—I did not hear the noble Lord, Lord Passfield, give it this evening—that I have often heard brought forward to account for that attitude is that this industry, or at any rate a portion of it in our Colonies, is not economically sound, and that the Government maintain that it is useless and a sheer waste of money to bolster up an uneconomic industry. As a general proposition I think there is possibly a certain amount to be said for that argument, but as applied to the present situation in the Colonies, it really is quite meaningless. Lord Olivier has repeatedly told us that if there were complete free trade in the sugar industry, our Colonies would emerge very successfully. They can produce sugar more cheaply than most other parts of the world, and this industry only appears uneconomic owing to the utterly artificial conditions which at present obtain throughout the world. In order to tide over these difficult times other countries are helping their industry, and I should have thought it almost incredible that our Government were prepared to stand by and watch what was a very flourishing, and what is in normal conditions a quite economically sound industry, being crushed out of existence in our Colonies because of an entirely artificially imposed set of conditions, which ought in the course of time to be put right. That is the argument that I want to stress this evening. The sugar industry in our Colonies is not uneconomic. In normal 375 circumstances, it not only pays its way, but it is profitable; and I can hardly conceive that the Government are prepared to see this economic industry in our Colonies wiped out, in order to make room for sugar produced in some other part of the world much more expensively than we can produce it in our Colonies.
I have heard it repeatedly said, and the noble Viscount, Lord Elibank, has said so this evening, that as far as many of our Colonies are concerned they would probably be far better off if they belonged to some other country. It is humiliating beyond words to hear such a thing said, but, as far as this specific matter is concerned, I am sorry to say that that statement cannot be very far from the truth, and I think it is utterly deplorable. If there is any meaning in the decisions of the recent Imperial Conference, and if there is any meaning in the constant protestations of the Government that they are anxious, and more than anxious, to do everything they can to extend and develop trade within the Empire, I say they ought to do something now which is going to be of some material help in the grave crisis in which the Colonies find themselves. I quite agree that this is a case where international arrangements might prove very valuable indeed, and I join with others in urging the Government to try to explore every avenue in order to reach an arrangement of that kind. But one is not very sanguine that, with a thousand and one important questions which have to be considered, this one will receive as much attention as it ought to receive. But in the meantime surely we cannot allow our Colonies to be let down, and if we do eventually come to some international arrangement it is quite obvious that in that case any benefit which resulted from such an arrangement would accrue only to other countries than ours.
Lord Olivier has spoken of the beet sugar industry in this country, and has referred to it as a competitor of the cane sugar industry in our Colonies. This is only true, surely, to a very limited extent, and I think the noble Viscount, Lord Elibank, has explained why. It is really a far vaster question than that. Surely the real competition which our Colonies have to face is not specifically the beet sugar industry in this country but the competition from sugar produced in vast 376 quantities throughout the rest of the world. Lord Elibank has said that the amount of sugar consumed in this country is almost twice as much, I think, as the total amount of sugar produced both here at home and in our Colonies; and in those circumstances, it is quite obvious that both these industries can quite well flourish side by side. I do say, however, that if the Government are willing to help our sugar industry here they ought equally to be prepared to help the older-established industry in our Colonies. It is very often said as an excuse by the Government that the people of this country cannot be expected to shoulder any burden in this matter. I think that the heaviness of that burden is very often exaggerated by the Government. Sugar is at a. ridiculously low price at the present moment, and personally I feel absolutely confident that the people of this country would be prepared and willing to make a small—an almost infinitesimal—sacrifice in order to save another part of our Empire from what is virtually ruin.
§ LORD OLIVIER
My Lords, I greatly wish that the noble Lord, Lord Passfield, had not given me anything to answer, but there are two or three points upon which I should not like his speech to go on the record without a little correction and contradiction. One was that he said the price of sugar had risen 20 per cent, since Mr. Chadbourne made his arrangements. That is hardly correct. The price of imported raw sugar has, I think, not risen much more than. 10 per cent.; and one of the last things I read before coming into this House was a speech made by Mr. Chadbourne, in which he expressed his great astonishment at the very sluggish response of the sugar market to the far-reaching arrangements that had been made. He said: "We have taken about 6,800,000 tons of sugar off the market and put it in cold storage, and reduced the crops of the world by about 2,000,000 tons, and yet sugar does not move, and I do not know when it is going to move. That is a thing I do not understand." And no one that I have met in the sugar world has the least expectation that sugar is going to rise within two or three years to a price at which our Colonial sugar would pay its way, even with the Preference. So we have two or three years at least to wait and there is this large load of over 6,000,000 or 7,000,000 tons of 377 sugar in cold storage which is to be fed out upon the market by instalments during the next five years. So the price of sugar is going to keep down and the crisis, as the noble Earl, Lord Plymouth, said, is to continue for a long time. That was one thing.
Then the noble Lord said that he thought that Mr. Chadbourne had done much better by going to the producers themselves than the Government would have done by international negotiation. I am very glad that Lord Plymouth has said that he still believes in international negotiation. We want international negotiation in order to get hold of Governments on a matter which is one of Government policy. The Government of Czecho-Slovakia and other Governments authoritatively and of set policy maintain the policy of dumping. We are suffering not only from over-production. Mr. Chadbourne deals with over-production and only with over-production. He does not deal with dumping. Cuba, at present, is dumping sugar. Czechoslovakia is dumping large quantities. Germany, Poland and Hungary are all dumping sugar. As I say, Mr. Chadbourne does not deal with that; he only deals with over-production and, therefore, the noble Lord left unanswered my argument in behalf of international action on the lines taken by Mr. Chamberlain with regard to bounty-fed sugar.
I was very much surprised to hear my noble friend in the latter part of his speech positively contradicting what he. said in the early part. He must have been in a hurry to get away to his dinner. He said that giving an increased Preference would mean expense, and no Government could possibly face expense by giving away Preference. Then he went on to say that the Government had thought it reasonable to give an increased subsidy to the beet sugar industry which he thought was much better. It was much better to give a. direct subsidy than to incur expense by giving away duties. I could not follow his argument. He seems to think it is much better to give a direct subsidy out of the Exchequer than to fail to take into the Exchequer a certain amount. I do not see the difference myself, but of the two I should have 378 said that the subsidy had much more in it of genuine expense than the failure to collect the necessary revenue. With the leave of your Lordships. I beg to withdraw my Motion for Papers.
§ Motion, by leave, withdrawn.