HL Deb 31 March 1954 vol 186 cc883-99

2.42 p.m.

LORD BALFOUR OF INCHRYE rose to draw attention to the results of the Sydney Conference; and to move for Papers. The noble Lord said: My Lords, I hope your Lordships will consider it is both appropriate and right that we should debate great issues such as the Sydney Conference which affect the destiny of our country. I trust that your Lordships will find this debate welcome, and the more so as it is to be graced by the maiden speech which we shall hear from my noble friend Lord Baillieu. Noble Lords who follow him will have the opportunity of congratulating him after his speech, but I cannot refrain from expressing my good wishes in the certainty that his maiden speech w ill appeal to your Lordships.

The Sydney Conference was not an emergency meeting to discuss emergency matters but one of a series of conferences between partners of this loosely-knit, undefined combination of nations which are of proven unity in ideals and effort, both in peace and in two world wars. The Commonwealth machinery of consultation remains informal. There have been at various times, in this country and elsewhere, proposals that this machinery should be made more permanent and that some fixed inter-Dominion consultative organisation should be formed. That idea has never found favour in authoritative quarters, either here or elsewhere within the Commonwealth, and I do not think that it is likely to find favour in the future. Nor does it seem to me necessary, so long as meetings such as this Sydney Conference are held at which subjects considered appropriate between partners in the Commonwealth are discussed amongst those partners.

It seems to me that the encouraging feature of the Sydney Conference, and the feature which is different from previous Commonwealth Conferences, is that at last we have reached the stage when the Commonwealth declares that it will act as a unit and not, as so often in previous conferences, agree that the several component parts shall each follow out some particular line of policy. At the Conference the Commonwealth endorsed as a unit the principle of Com monwealth Preference—I do not mean preference in the narrow tariff sense but preference for development and investment. I trust your Lordships will agree that, when we talk of the ability of this country to participate in Commonwealth development, it is good to remember that this investment is possible only because of the policy of the Chancellor of the Exchequer and Her Majesty's Government over the last few years, which has resulted in the growth of the strength of the sterling area.

The story of our recovery is told in the Economic Survey which is issued to your Lordships to-day—a message of reasoned and cautious optimism. The major part that Britain is expected to play in this policy of investment has been made possible—and it cannot be too widely known —only because of the policy of Her Majesty's Government which turned a threatened sterling area deficit of £1,000 million in 1951–52 into a surplus of over £400 million by mid-1952–53, with reserves in the sterling area by January, 1954, of more than £900 million. Those are achievements of which I think the Government have every reason to be proud and which give every reason for congratulation to the Chancellor of the Exchequer.

Nevertheless, he must feel some disappointment that the world, and particularly the dollar world, has not accepted our exports to the extent that he himself declared necessary in December, 1952. At that time, he told representatives of industry, commerce and organised labour that we must increase our exports by 20 per cent. over 1951 in order to achieve a surplus of some £300 million to £350 million in our balance of payments required to build up reserves and provide for investment overseas. In fact, the exports have shown no great rise which will enable them to play their part to the extent the Chancellor of the Exchequer had hoped. The Economic Survey shows that the volume of exports is running at approximately 5 per cent. above last year's average level, but when we take into consideration possible falls in price level I feel that there is no great reason for optimism that the world will accept British exports to the extent that the Chancellor of the Exchequer hoped. Indeed, at the Sydney Conference my right honourable friend spoke of £120 million being sanctioned for Common wealth investment. I should like to ask the Government how they reconcile the figure of £120 million with the expectations declared by the Chancellor of the Exchequer in 1952, that from £300 million to £350 million would be the necessary figure.

The ultimate purpose of investment and development is production, but I would submit to your Lordships that there can be no incentive to the British investor to invest in production overseas, for the Dominions to borrow funds, or for emigrants to leave this or other countries and go to work and settle in the Dominions, unless there is a reasonable chance of the resulting production finding a market. In fact, Commonwealth development hinges upon the certainty of stable markets, and stable markets, in turn, hinge upon some form of preferential treatment in one form or another. For these reasons, systems of tariff preferences which give continuous mutually agreeable incentives are essential for the sound expansion of Commonwealth production. That truth, if you will accept it as a truth, brings us straight up against what I believe is by far the most important issue, and the widest issue, of the Sydney Conference: the decision of Her Majesty's Government to have one more try for a free trade world, based on the hope a! a change of economic heart and policy by the United States. It is the Government's decision to accept for Britain the continuance of the principle of non-discrimination in international trade and the extension of the most-favoured-nation treatment to all who conform to these rules.

In sustaining their faith in the possibility of a free trade world, the Government are following along the lines which have been followed since 1946, and which I believe, if we look to past history, will show a series of declared expectations unfulfilled and economic forecasts confounded. The Government still declare their belief in this aim and policy of the multilateral free trade world, and they are apparently not discouraged by setbacks. At the same time, it seems to me, they do not express any very great enthusiasm about the possibility of the horse they backed running rather faster than it has hitherto. The Government have expressed no great enthusiasm for the Randall Commission Report. It seems to me that the Randall Commission Report gives little encouragement of any drastic liberalising of tariffs and trade in the United States economic policy. If your Lordships will look at to-day's Manchester Guardian, which contains an interview with Mr. Randall, you will observe that he does not seem very optimistic that even his modest proposals will find favour with the Republican Congress, in spite of the fact that the President of the United States has sent a message to his Administration asking that the Legislature shall assent to the Randall proposals. Those proposals are modest proposals, but their reception is only lukewarm.

The conviction of Her Majesty's Government, it seems to me, is that in spite of a nationalistic world, where there is no international equilibrium, they think this attempt at a free trade world is still worth while, and they accept the risk and the cost. At the Sydney Conference, this belief was translated into a willingness not to press for the Amendment of G.A.T.T. This belief in the free trade world took the form of declaring that, though we believed in tariff preference as a method of canalising mutually advantageous trade channels, Britain was willing to defer to the wishes of those who were unwilling to make any advance beyond the present position. The issue of discrimination or non-discrimination in our international trade is often befogged by critics who can describe reasonable discrimination only in terms of exclusion. The truth is that we all want an expanding economy and the highest possible level of international trade. The question is, how are we going to get it; and if, later, we have to alter our economic course, how much shall we have to pay for the time that we have spent in following a policy that has subsequently to be abandoned.

While we pursue this aim of multilateral international trade, we are losing good will and faith in Britain by parts of the Colonial Empire; and that is a sad thing. We should all realise the price we are paying for this attempt. The tobacco, sugar, banana and citrus fruits industries of the West Indies are unable to gain any increased preferences in our markets for which they are crying out and to which they feel entitled, morally as well as economically. Because of the shackles of G.A.T.T., we can do no more than we are doing now to help them. That is part of the cost we are having to pay for the pursuit of the multilateral free trade world. It is tragic to read in Jamaica of bitter resentment, of talk of breaks in trade ties with the United Kingdom in favour of reciprocal arrangements with Canada because we cannot do more for the West Indies than we do. It is tragic, also, to know that Trinidad's Government have considered it necessary to call a protest meeting of citrus-producing West Indian Colonies to protest against the purchase by the United Kingdom of nearly £l million of citrus from the United States. That is part of Her Majesty's Government's policy, but let us not hide from ourselves the cost, in good will and in faith in Britain, which this policy has meant to us at the present time.

Again, while we pursue this aim of the multilateral free trade world, we do so at a cost of our ability to protect our home markets of agriculture and industry. Since 1945, we have in fact enjoyed protection in this country, not so much by tariff but from transitory factors which are now disappearing—the protection through balance of payments restrictions and the destruction of enemy industrial property and plant. That has given us a degree of protection, apart from tariffs, which is sliding away, and now we are about to face the full blast of competition, in Europe and Asia, from those who were our enemies before. We have not yet met that full blast either in our overseas or in our home markets. We are beginning to feel, as in shipbuilding, the effect of indirectly subsidised work carried out in the yards of our foreign competitors. This competition, particularly if there is a severe United States recession, which would have a magnified effect in this country, may require suddenly some rapid and positive action by the Government of the day in order to protect our home markets. Noble Lords on that side and this side of the House will remember the 1931 crisis: the Abnormal Importations Act had to be passed rapidly through Parliament to save our industry from the blast of unexpected, sudden and, as we termed it, unfair competition.

We agreed at the Sydney Conference to continue a condition in which, if such a situation arises, we are powerless to protect our home markets, short of using the very methods of quantitative licence and quotas which we are all trying to discard. This curious position has arisen because, under G.A.T.T., we cannot use a tariff as a means of home protection. If we wish to raise any unbound tariff or create a new tariff, we cannot do so, because we are pledged by G.A.T.T. to raise correspondingly the duties against Commonwealth imports. But by the Ottawa Agreements we are pledged to allow into the United Kingdom, duty-free, virtually all the Commonwealth production of agriculture and industry. So we are in a cleft stick, because, so long as G.A.T.T. exists in its present form, we must discard one or the other; and, if a situation arose such as that, we should be driven to the worst form of discrimination and protection—again, licences, quotas and quantitative restrictions, which I repeat we are all trying to discard.

I have tried only to show on the debit side something of the costs and dangers of clinging, perhaps too persistently, to the present policy of hoping for an economic sunrise in the West. I have not dealt—and I will not delay your Lordships by attempting to do so—with the pros and cons of whether we could or could not have taken some unilateral action in Sydney in the way of modifying the General Agreement on Tariffs and Trade—whether or not, had we taken that unilateral action, the risks for this country would have been too great in relation to the possible benefits—or whether it was better to follow the policy which Her Majesty's Government did, of saying, "We cannot go further than our partners agree to go." Her Majesty's Government who have the responsibility for the affairs of this nation took the latter view.

But without arguing the point as to whether we could or could not have done something more at Sydney, let me say this. The future of the principle of the right of discrimination in our trade comes up for settlement at Geneva this autumn, when the General Agreement on Tariffs and Trade is to be reviewed. It is necessary that decisions of immense importance shall be reached before, and not during, the Geneva session, if Britain is not to be tied up for a further period of years with the chains that now bind our economic freedom. Before the autumn, we shall see the reaction of the Republican Congress to the message of the Administration on the Randall Commission. We shall see whether there are any indications that the Republican Congress will allow a drastic change in the way of the liberalising of American economic policy. My own view is that those who believe in that are going to be disappointed—I may be right, I may be wrong, but we shall see.

Whatever alternative exposes itself, I would conclude by asking that Her Majesty's Government should arrive at decisions in the light of actual facts and practical needs, rather than beliefs and hopes which have not yet been fulfilled and which, it seems to me, are not likely to be fulfilled in the reasonable future. My Lords, my plea is this. All credit to the Government for all that they have achieved. But do not let us hope for too long and at too great a cost for something in the way of an international free trade world when it is not going to be attained. Rather let us look alter ourselves and our partners by restoring to ourselves a reasonable degree of discrimination; and let us be ready to do it before the Geneva Conference in the autumn. My Lords, I beg to move for Papers.

3.4 p.m.


My Lords, the Whole House is indebted to my noble friend Lord Balfour of Inchrye for introducing to us to-day the topic of the Sydney Conference and all its problems, which, indeed, range very wide over almost the whole economic field. I think it is important, as indeed he reminded us, to bear in mind that this was not a special Conference called to deal with an emergency or with some new situation. It was one of the regular meetings of the Finance Ministers to review the action which the sterling area countries have been taking in concert ever since the beginning of 1952. It has been said (it is easy to criticise a communique—I have done it myself sometimes) that there was nothing very novel in the outcome of this Conference. That is quite true, but I do not see why that should be a source of adverse criticism. As my noble friend pointed out, it shows that the action we have been taking, individually and collectively, over the past two years has been singularly successful.

In the life of nations, as of individuals, discord often attracts more attention than harmony—I think that is also true of modern music. But two years' harmonious co-operation in the Commonwealth has certainly yielded remarkable results. We were running hopelessly into debt. In the last quarter of 1951 the sterling area was running a balance on the wrong side at the annual rate of over £1,400 million. I agree that it is also fair to take what was the annual figure over the whole year. The convenient way of dealing with Commonwealth accounts is to take them from June to June—that is the common practice of us all. The deficit of the Commonwealth sterling area, in balance of payments in the year ended June 30, 1952, was £1,000 million. That deficit was turned into a surplus of over £430 million in the year ended June, 1953.

At the Conference, Minister after Minister testified to the importance of sound internal policies and the effect which these have had. in producing this satisfactory change. The Governments all testified to their conviction that we are following the right road in our domestic policies and in our general economic policy, and that we are confirmed in our determination to go on following that road together. In fact, I think the theme of the Conference arid the attitude of all the Commonwealth countries can be summed up in the words "confidence", "resolution" and "preparedness". The noble Lord, Lord Balfour of Inchrye, has spoken a great deal of Her Majesty's Government in this country, but nearly all that he was saying concerned, of course, the collective judgment and decision of all the Commonwealth countries. It is rather important that we bear that in mind, because we could no more dictate to seven other wholly sovereign members of the Commonwealth than they could dictate to us—and none of us would wish to. If we are to act together, we must act in concert.

The Conference reaffirmed its support of the policy which is generally referred to as the collective approach.

It was to this aspect that my noble friend devoted a good deal of his speech. I think he was perhaps unduly pessimistic on the prospects for the liberalisation of the United States trade policy. I think someone once said that pessimists were people who had lived with optimists. The noble Lord may have been in hopeful company lately, but I would, at any rate, ask him to wait and see. We have all seen this morning the message which the President of the United States has addressed to Congress. That message contains a number of specific proposals, founded largely on the Randall Report, many of which are directed to the reduction of the American tariff and to the simplification of American customs procedure. I think that any trader would agree that the simplification of procedure is at least as important as, and perhaps more important than, the reduction of the tariff. Your Lordships may have observed that the President himself characterises these customs procedures as an "unwarranted" burden on trade. I think, too, that we ought to look not only at the specific proposals, but at the language which the President uses in this very carefully framed message, and at the spirit which inspires it. The scene now shifts to Congress, and we shall not, of course, be able to form a fair judgment—or indeed any judgment at all—until we see how Congress reacts. Some time must elapse before final decisions are taken.

I find myself in agreement with the noble Lord on this at any rate—that all this emphasises the importance, in other Commonwealth countries and here, of doing everything we can in three directions: first, in the development of Commonwealth resources; secondly, in the expansion of exports based on efficient production (and they will not be based on anything else); and, thirdly, in doing the maximum of trade we can within the Commonwealth. We are, in fact, carrying out this threefold policy. Where I differ from the noble Lord is in this. That policy which we are carrying out is not an alternative to the collective approach. That threefold policy is very necessary whether the collective approach succeeds or fails; it is not in the least inconsistent with the collective approach. Indeed, I would say that the threefold policy is really complementary to it. If I may take an example with which I am very familiar, I would refer to the Ottawa Conference and the work which we did there (I think I am the sole survivor of that shocking episode; but I am not at all ashamed of what we did). If noble Lords will look at the trend of trade following Ottawa they will see, it is true, that trade within the Empire increased enormously; but—and this is the interesting and significant thing—they will see that trade between countries of the Empire and the rest of the world increased in even greater volume than trade within the Commonwealth. Therefore, I would say—indeed I must treat this as axiomatic—that the stronger we in the Commonwealth are in our resources and in our mutual trade, the better shall we all be able to play our part in a wider and freer system of world trade, if that can be brought about.

It follows from what I have said that I cannot accept Lord Balfour of Inchrye's thesis—if I have followed him aright— that we have to choose between the collective approach and Commonwealth development. And surely he is wrong in saying that we shall have to pay for the time we have spent in following a policy that may have to be abandoned assuming that the collective approach gets us nowhere. But there is nothing to abandon. We have not removed restrictions on dollar imports, and we certainly shall not remove such restrictions unless we are satisfied that all the conditions are present in which it would be safe and beneficial for us to do so. And, as I have said, and shall show further in a few minutes, we are doing all we can to develop Commonwealth resources. It has been our practice, and it will certainly remain our policy, to keep an open door for imports from the Commonwealth sterling area. My noble friend characterised the collective approach as "one more try for a Free Trade world." That awakes echoes of the Election of 1906; but it surely is a considerable exaggeration, even if the conditions were the most favourable anyone can imagine. It really would not be a Free Trade world. It would be more accurate to say that it would be a world in which there was more and freer trade. Of course, there is no question of eliminating tariffs.

That leads me to say something following on what the noble Lord has said, and to speak very frankly about G.A.T.T. and Imperial Preference. My own personal views are known, and I think I express the views of my Party and of the Government in this. We were always opposed to and disliked the "no new preference" rule. But it is riot something that happened at Sydney. It was clear at the Conference in December, 1952, that the countries of the Commonwealth held differing views about Imperial Preference and about G.A.T T. We, in the United Kingdom, argued strongly that the whole Commonwealth should join in getting G.A.T.T. amended to allow new preferences; in fact, that Imperial Preference should be treated on similar terms to closer and more exclusive customs unions. I argued vehemently—and I thought logically and convincingly: I certainly convinced myself—that it was neither logical, nor sensible, nor fair, to say that a customs union which enabled a group of countries to encircle themselves with an all-embracing prohibitive twill ring was a blessed thing but that the looser and far less prohibitive system of Imperial Preference was something wicked—a sort of poliomyelitis infection. I put that very forcibly. But I am bound to say that I could not get the majority of the Commonwealth countries to agree. The largest measure of agreement 'we could get as between Commonwealth countries at the Conference was this: first of all, a general desire to maintain existing preferences, founded on a belief in their value. I was glad to see that the able Finance Minister in India, Sir Chintaman Deshmukh, during the Budget debate in the last day or two staled emphatically in the House of the People in India that he stood by the existing preferences because he regarded them as of real value both to India and to this country.

But while the Commonwealth countries as a whole would not go further than maintenance of existing preferences, they agreed after a great deal of discussion —and this is the second point—that there should be a united effort in which they would all be prepared to join, to get the G.A.T.T. countries to agree that the "no new preference" rule should be amended to allow the United Kingdom to raise duties where there is free entry for Commonwealth countries to-day, and to raise those duties without imposing corresponding duties on Commonwealth products. We all tried to do that, but were only partly successful. I admit there was a gap. The Government regret that we could not persuade a number of Commonwealth countries to go further. It is much better to talk about this position quite frankly. We could riot, and that is a fact we have to face and accept.

Your Lordships may have noticed that when people talk about G.A.T.T., they are apt to dilate on the features they like or dislike. My noble friend was no exception. But we have to look at all four quarters of the animal. I admit that it is rather a mixture. I must not say it is a mongrel; that would be rude to it; but it is a rather odd amalgam. It combines moral aphorisms, codes of conduce admonitions and prohibitions, many of them no doubt very sound, of what we shall do and what we shall not do; but bound up with all the codes and platitudes are a number of special tariff bargains. The Government in this country and the Governments of other Commonwealth countries made those bargains with a number of foreign Governments because they thought they were good business. It all hangs together. One country cannot get rid of the bits they do not like and keep the bits they do like, unless they get the agreement of all the other countries. It is like any other contract or treaty. There was one thing on which all the Commonwealth countries agreed, both last year and this—that was, that it is in the interests of all of us to keep the tariff rates which are bound by Agreements embodies in G.A.T.T., bound for a further period.

Personally I regret that the "no new preference" rule was ever introduced into the General Agreement. I doubt whether it was really necessary to abandon freedom in preference in order to get the tariff concessions. I think that when these Agreements were being negotiated it would have been wise to have taken perhaps a little less in tariff concession and for the Commonwealth to have kept its freedom. But there it is; we have the Agreement. We have the attitude of the Commonwealth Governments. Imperial Preference and Empire trade are reciprocal processes, and it is important that we should act in concert. Then the noble Lord. Lord Balfour of Inchrye came to what, after all, is the crux of the matter— that is, accepting that the Commonwealth are not all at one over this business, should we be wise to take unilateral action? —I thought he was very fair in saying that he was not going to commit himself to that. I am sure he is right. I am sure that we should do more harm than good by isolated independent action by merely denouncing G.A.T.T. ourselves, which would deprive us of every benefit without getting the Commonwealth to move along with us. G.A.T.T. comes up for review at the end of this year or early next year, and the Commonwealth Governments have agreed that we will consult together. It will have to be a very full consultation, and we must all do a lot of work on it before that review takes place. That we have undertaken to do, and we certainly shall do it. We shall not leave it till some Geneva meeting and have a consultation in the corridor. That is not the way we propose to work it.

This situation makes it all the more important that we should concentrate on the development of Commonwealth resources. That development not only increases the strength and wealth of the country in which the development takes place, but is an immediate encouragement to exports from this country. It leads to more sterling imports and saving of dollars and to more mutual trade in the future. All this strengthens the whole Commonwealth and fortifies the trade balance and reserves of the Commonwealth sterling area. I take a very good example, which your Lordships will have noticed recently in the Press—that is, the Sui gas development in Pakistan. That is a tremendous find. It is a great bit of luck to find this vast area of natural gas which is already proved and which is estimated to be sufficient to relieve them for seventy to eighty years of all need to import coal. That is going forward, and going forward, as I see it, in exactly the right kind of partnership.

The Pakistan Government have a share —Pakistan shareholders have had an issue, which was over- subscribed six or seven times—the Burmah Oil Company have an interest, and there could not be a more efficient undertaking for them to be in partnership with. And I am glad to say the Commonwealth Development Finance Company, which your Lordships will know to be the new institution founded in the City by a number of trading firms after the 1952 Commonwealth Conference, have taken up £1 million of equity capital. I do not think I am revealing any secret when I say that already, as a result of this new partnership undertaking, large orders have come to this country. That seems to me a typically good example. We are practising what we preach. Last year, over £120 million was approved for investment in the Commonwealth Sterling Area. This is all new money; it is not transfers of existing capital. In addition to that, £ 38 million worth of capital was approved for transfer to Canada.

If I do not weary the House, I want to deal with one other matter; not that my noble friend raised it—I should not have expected him to do that—but it has been canvassed a great deal outside. It has been said that we can develop intra-Commonwealth trade only if we are ready to stick to Government bulk purchase, of which the noble Viscount, Lord Alexander of Hillsborough, is such a strenuous advocate. It would indeed be a most unhappy dilemma if it were true that we had to choose between freedom and Empire; if the old motto Imperium et libertas were Imperium aut libertas. Fortunately there is no such dilemma. It is quite untrue to suggest that we must have bulk purchase if we are to have intra- Commonwealth trade. That was developing well before the war, when hulk purchase played no part. It went very well after Ottawa and there was no suggestion to me at Ottawa, or afterwards, that we could develop trade within the Empire only if we had bulk purchase.

Laying aside dogma, there really are grave dangers and disadvantages in bulk purchase. It may be costly to the taxpayer. It depends, after all, on the single judgment in one commodity, or in a series of commodities, of a Minister or Ministers, and their officials, few of them trained to the job, and none of them universal experts. Nothing is harder than to gauge the future of a market. I should like to give your Lordships an instance in my own experience in this Government, while I was still responsible for a great commodity which I am now glad to say has been restored to a free market and exchange. I got hold of the two biggest consumers in this country of this article, and I got the two leading men in each firm to come and advise me. I said: "What view do you take of the market to- day in this commodity and of future prospects?" Sitting there together with me, they gave me diametrically opposed views. One of them said,"Well, if I could, I should buy three months forward." The other one said, "I do not agree in the least; I should not buy forward at all." Is that not a good example of how much wiser it is, in the interests of trade, and certainly of the taxpayers, that these things should be in free markets, where individuals can exercise trading judgment? Moreover, this freedom enables us to reopen the commodity markets. Those markets are not there just for speculation. They came into being, grew and prospered because of their value to producers and to buyers. They are of great value to us and to the Commonwealth. They earn currency, directly and indirectly, and thereby they enhance the value of sterling and confidence in the pound, which is a common interest of the whole Commonwealth.

That leads me to this comment. There is one aspect of the present situation which has not attracted much attention, because it is not at all sensational; but it is very satisfactory. The sterling area has now weathered six or eight months of a gradual downturn of United States activity —"downturn," I believe, is the fashionable phrase to use now as the polite equivalent for a modest recession. Anyway, that has been going on. Yet we have met that with confidence frilly maintained in this country, with the pound stronger than it ever was, and with a steady accretion to our reserves, in spite of the fact that we had heavy debt and interest payments at the end of last year. That is an immeasurably better performance than we have ever put up, in similar circumstances, since the war. I think that is proof of the confidence of foreign countries in our policy, and in sterling, and it shows how important it is to continue with this policy.

I have spoken of the present. If I am asked about the future, without claiming to be at all infallible I should say that the sterling area ought to enjoy a substantial balance with the rest of the world this year; but I do not think we can expect that to be as high as we achieved in the latter part of 1952 or in 1953. It must be remembered that we and other sterling area countries have liberalised our policy by the removal of restrictions. Also — and this is a most satisfactory feature — production has risen considerably, which in its turn involves a considerable increase in the volume of our imports of raw materials. We are not doing too badly over exports at the present time. My noble friend Lord Balfour of Inchrye mentioned dollar exports. In 1953 our exports to dollar countries were £47 million higher than in 1952 —the noble Lord will find that in paragraph 19 of the Economic Survey which has just been published. Our total exports in recent months have been running at about 5 per cent. above last year's average.


In volume.


Yes, in volume. We can draw encouragement from these facts, but certainly we must not become complacent. The law fundamental is always there: that we have got to be competitive producers. Whatever we like to do to our own tariff, we have got to export competitively, and we have got to pay for our imports of raw materials and food by competitive exports. We have been doing better in recent months. But it is not enough to hold that position. We must do better still if we are to improve our reserves and to have the substantial balance we should like to see for investment, particularly in the Commonwealth.

The facts of our economic position are so important that we must do all we can to make these facts and their implications known to all our people. The Government, of course, must do everything they can in this way: I am sure we are all agreed about that. Successive Governments have given —and they have been right to do so —a wealth of information on the general industrial and economic position, and, indeed, on the broad facts of particular industries. We shall continue to do that, and we should welcome any practical suggestions on how that information can be made more graphic and more effective. But, at best, the information which the Government can give, authoritative and important as it is, must be somewhat general. That is true, too, in a lesser degree, of the admirable work done by organisations like the British Productivity Council. But when the Government and organisations have done all they can, it is only the individual firm which can apply the general knowledge to the particular circumstances of a trade. It surely is of the highest importance that this application, in terms of production, price and competition, should be known and appreciated on every shop floor. I know that many firms are doing this, but the aggregate of our exports and our trade balance depends on the efforts of each and all. We are all in it together, and we ought all to share the same knowledge. If I may !use an old military saying, every man should have sufficient knowledge of the general idea to carry out his particular operation.

I should like to close on another encouraging note. Last year I was lucky enough to visit six Commonwealth countries—or, rather five countries and a continent, because it included every State in Australia. Anyone who visits the Commonwealth to-day cannot fail to be impressed by the deep interest which every country takes in the progress in the economic condition of all the other countries. The diversity of the Commonwealth, and the sovereign independence of its constituent countries, has, thank heaven ! in no way diminished, but rather has enhanced the realisation of our interdependence, and the fact that we are all members one of another. In that unity lies our strength.