Clause 6. — (Customs Duty on patent leather.)

Orders of the Day — Finance Bill. – in the House of Commons on 4th June 1934.

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Photo of Mr Robert Bourne Mr Robert Bourne , Oxford

The first Amendment which I shall take on this Clause is that standing in the name of the hon. Member for St. Rollox (Mr. Leonard)—in page 5, line 4, to leave out "fifteen" and to insert "eleven."

Photo of Sir Stafford Cripps Sir Stafford Cripps , Bristol East

Is the Amendment which comes first out of order, or not selected?

Photo of Mr Robert Bourne Mr Robert Bourne , Oxford

The Amendment practically means the negation of the Clause.

Photo of Sir Stafford Cripps Sir Stafford Cripps , Bristol East

It does not amount to the negation of the Clause, but merely says that a certain duty has to be fixed. Prior to that date the matter has to be referred to a Committee. It is still entitled to a duty on a recommendation of the Committee being made.

Photo of Mr Robert Bourne Mr Robert Bourne , Oxford

If the Committee makes that recommendation, it will be unnecessary.

Photo of Sir Stafford Cripps Sir Stafford Cripps , Bristol East

Further to that point of Order. From the point of view of procedure, the recommendation has to be confirmed by this House.

Photo of Mr Robert Bourne Mr Robert Bourne , Oxford

I think not. In the ordinary way it is open to the Import Duties Advisory Committee to make a recommendation. The object of the Clause is to make an order without going to Advisory Committee.

7.8 p.m.

Photo of Mr Tom Smith Mr Tom Smith , Normanton

I beg to move in page 5, line 4, to leave out "fifteen," and to insert "eleven."

The argument of the Parliamentary Secretary to the Board of Trade when moving the recommendations of the Import Duties Advisory Committee, has been that the whole of the matters have been thoroughly threshed out, and that the recommendations have been made after going into the whole of the facts. We have been told that it is the purpose of the Import Duties Advisory Committee to suggest changes in customs duties in order to protect the home manufacturer of the particular article in respect of which the application is made. I can well understand that. The manufacturer of the article says, "Look there, we are being affected by foreign competition." As a result of the inquiry, the Order comes before the House. This Clause seeks to put a customs duty equal to 15 per cent. on certain kinds of patent leather goods. The Committee ought to be aware of the fact that a new duty of 15 per cent. is not being levied. It is increasing an existing duty from 10 to 15 per cent., and the Committee will observe that it is not being done through the Imports Advisory Committee.

We on this side of the House are not satisfied with the way in which this matter is being manipulated, and I think the Committee ought to be made aware of the history of the matter. On 15th February, 1933, an application was made to the Import Duties Advisory Committee for an increase of the duty on certain patent leather from 10 to 15 per cent. Notice was given and a statement from the different interests who were opposing the application was made. The Federation of Boot and Shoe Manufacturers, a British federation in this-country, opposed the application, and the Co-operative Wholesale Society submitted its statement in writing. Later on an inquiry was held, oral evidence was submitted, and the case for the suggested increase from 10 to 15 per cent. was opposed on the ground that the duty was unnecessary, because there was little production at home of what may be termed patent-shoe leather. As a matter of fact, and I do not think the Parliamentary Secretary will dispute it, up to a few months ago there was only one firm in this country engaged in the manufacture of patent-shoe leather. I believe there are now two or three. I think he will agree that the production at home is very limited indeed.

After the inquiry had taken place and oral evidence had been submitted, on 6th April the Advisory Committee wrote and said, that the committee did not propose to make any recommendations at present in regard to the application for an additional duty on patent leather. In other words, the committee obviously felt that no case had been made out for an additional duty. Then to the surprise of everybody came the suggested increase in the Finance Bill, although the Chancellor of the Exchequer made no reference to the matter in his Budget Speech.

The committee have a right to know why this particular departure has been made in the case of patent leather. When I listened to the Parliamentary Secretary I thought he failed to make out a convincing case; at any rate, he did not convince me. Personally, I was not satisfied that he was speaking with his usual confidence, because I do not think he himself is satisfied that this thing has been brought about fairly. What was his argument? The Import Duties Advisory Committee decided that this matter was outside their jurisdiction; that they were concerned with trade within the United Kingdom. If they found the matter likely to benefit somebody else, it was not their business. The real reason for it, he said, was that the Government had found that two sets of industrialists had made a bargain between themselves, one in this country and the other in the Dominion of Canada. Even at Ottawa, with the Government representatives there, they were unaware of the bargain made between the two sets of industrialists. The real reason for this increase was to implement fully this bargain made between the two sets of industrialists. That being so, we think it is grossly unfair. We say there is no case for an increase of duty, because the home producer is not suffering from foreign competition and production is very small. If any increase of duty is necessary, it should come through the ordinary channels.

To my mind this matter has not been brought about fairly. Is it suggested, simply because two sets of industrialists have made a bargain, that we must implement it? Is this to be taken as a precedent? If two industrialists reach a bargain on another matter, will the Government implement that? There was a bargain made between an industrial section in this country and another in Canada. The Parliamentary Secretary admits it. Because of that the Government decide to implement the bargain by bringing in this Clause, although the Import Duties Advisory Committee have stated that they do not propose to make any recommendation. There is no case for the increase. As regards costs, it was admitted by those bringing forward the application to be about 1½d. to 2½d. per pair of shoes. The extra 5 per cent. is likely to increase the price of shoes by another 1d. or 1½d. So far as cost is concerned, I have evidence in my hand to show that in the case of one particular firm of boot manufacturers they will be mulcted £3,000 or £4,000 as a result of this unnecessary 5 per cent. On the whole, I feel there is no case for the increase, and I hope the Committee will reject it.

7.15 p.m.

Mr. WEST:

I have been trying to discover some reasons for this increase, but so far I have been unsuccessful. I thought at first there might be some reason because the Canadian manufacturers have been unloading tariffs on the importation of British leather and allied goods, but I find the contrary is the case. As a matter of fact, I think it is true that Canadian tariffs have been increased so far as British imports are concerned. I have the authority of two Conservative speakers two or three weeks ago for that statement, and I thought that they ought to be experts on tariffs at any rate. The second thing I cannot understand is why the Advisory Committee turned down a recommendation for an increase. I understand that the Parliamentary Secretary has stated that that was because it was outside their jurisdiction, but that seems a very dubious reason when one considers that the committee heard all the evidence and arguments of the manufacturers. Why should they hear the evidence if it is outside their jurisdiction?

Another point that struck me was that it could not be a question of looking after British trading interests, because the most important trading interests, the boot manufacturers, were opposed to the increase. That interest represents at least 100 times more employés than the single patent leather firm that was concerned at that time. The boot interests represents 80 per cent. of the total use of leather of this kind in this country, and they were opposed to the increase. The only reason I heard given was even worse than that which my hon. Friend has stated—that one Canadian firm at Ottawa had made a kind of semi-official bargain with the British interests. It seems extraordinary that one British firm employing fewer than 1,000 workers can override the interests of another industry with more than 100,000 workers; and it seems more extraordinary that this one small firm can bind the British Government to raise the rate from 10 per cent. to 15 per cent., even though no arguments have been adduced to show that any advantage accrues to this country. I hope the Minister will give us better and more adequate reasons for this increase than were given on the last occasion.

7.18 p.m.

Photo of Mr Edward Mallalieu Mr Edward Mallalieu , Colne Valley

We are entitled to a little more explanation of this duty. I should like to support the Amendment. The Parliamentary Secretary to the Board of Trade still seems to persist in what I think is a most extraordinary position, namely, that when this application for an increased duty on patent leather—an application made by Canadian interests—came before the Import Duties Advisory Committee it was not rejected. We have heard that the committee heard all the evidence on the subject, and I think it is true to infer from that that they rejected the claim——

Photo of Mr Edward Burgin Mr Edward Burgin , Luton

There was no rejection by the Import Duties Advisory Committee. After hearing the evidence, it was found that the matter was beyond their competence.

Photo of Sir Stafford Cripps Sir Stafford Cripps , Bristol East

I understand that the letter the Advisory Committee wrote on the 6th April, 1933, to some of the opponents stated that the committee did not propose to make any recommendations at present in regard to the application for an additional duty on patent leather. There was no suggestion that it was outside their competence. It simply turned the application down "for the present."

Photo of Mr Edward Mallalieu Mr Edward Mallalieu , Colne Valley

I entirely agree with my hon. and learned Friend. There was a definite hearing of evidence, and the application was not granted. In ordinary terms, that means that the application was rejected. I submit that the reason was because of Section 3, Subsection (2), of the Import Duties Act, 1932, which lays down plainly when these applications may or may not be rejected or accepted. May I remind the Committee of what that Sub-section says: In deciding what recommendation, if any, to make for the purposes of this Section, the Committee shall have regard to the advisability in the national interest of restricting imports into the United Kingdom and the interests generally of trade and industry in the United Kingdom. Of course, having heard the evidence, it was perfectly plain to the Advisory Committee that this was not in the interests of the trade and industry of this country. I am glad to see the admission of the Parliamentary Secretary; I do not think he was saying anything to the contrary. That, in my submission, is a rejection; he says it is not, but we agree what it was in effect. He went on to say that this proposal was to the benefit of Canadian industries, and he pointed out that he hoped we should get some sort of concession in future from Canadian industry. I would like to tell him that in the West Riding of Yorkshire not very much is thought of the hopes which he expressed in that direction. I want him to say what sort of thing he hopes to get as a result of this sacrifice of a certain section of British industry in the interests of Canadian industry. The Committee might legitimately demand some explanation as to what he hopes to get from Canada. Is it the sort of thing that the woollen and worsted trades of the West Riding have recently obtained from the Canadian Tariff Board? If not, what is it?

7.23 p.m.

Photo of Mr Edward Burgin Mr Edward Burgin , Luton

We are discussing patent leather, and the Committee might like to know some of the figures relating to it. The imports of patent, varnished, japanned and enamelled leather entering this country from all sources in 1933 amounted approximately to £750,000. In the first three months of 1934 the importation from all sources amounted to £98,000. Of that amount, £64,000 came from Canada. Hon. Members will appreciate that all that comes from Canada comes free of all duty whatever, whatever the rate of duty may be that is imposed on the leather that comes from elsewhere. We are discussing the duty on the remainder, and the additional revenue from the duty, if the Clause to which I am speaking is added to the Bill, will amount to approximately £10,000 in a full year, adding at most one halfpenny per square foot on the price of patent leather—not one halfpenny per pair of shoes but a halfpenny per square foot.

Photo of Mr Tom Smith Mr Tom Smith , Normanton

When I mentioned the figures, I quoted from one who submitted evidence to the Committee, in which he said the present 10 per cent. duty represented 1½d. to 2½d. per pair of boots.

Photo of Mr Edward Burgin Mr Edward Burgin , Luton

I am not in any way discussing the sources of information open to the hon. Member, but the tables that have been prepared for Government purposes, to which I have access, show that the increase in price on patent leather will be unlikely to be as much as one halfpenny per square foot. The question which is really before the Committee is, to use the words of the hon. Member who moved the Amendment, whether the Committee have been treated fairly. The issue I have to face is that for some reason the Government, instead of using the ordinary procedure of the Import Duties Act, have adopted the less usual course of putting a Clause in the Finance Bill, and did that, to use the hon. Gentleman's expression, after the Import Duties Advisory Committee had considered the evidence. There is no dispute about the facts, although the Committee may not have the whole of them in their possession. The United Kingdom Tanning Industries and the Canadian Tanning Industries on the 5th July, 1932, made an agreement. The material clause of that agreement stated that: The United Kingdom had placed a duty of 15 per cent. on foreign leather except patent leather, and, conditional on the continuation of the present arrangement plus the granting of protection in that market equal to 15 per cent. ad valorem against foreign patent leather the Canadian Tanning Industries have agreed with the United Kingdom leather delegates to recommend that the Canadian Government should reduce the British preferential rate of 15 per cent ad valorem "——

Photo of Sir Stafford Cripps Sir Stafford Cripps , Bristol East

Is the hon. Gentleman reading from the agreement?

Photo of Mr Edward Burgin Mr Edward Burgin , Luton

I am reading from a clause in it.

Photo of Sir Stafford Cripps Sir Stafford Cripps , Bristol East

May I ask that the agreement be produced and laid on the Table of the House if the hon. Gentleman is quoting from it?

Photo of Mr Robert Bourne Mr Robert Bourne , Oxford

I am sure, if the hon. Gentleman is quoting from an official document, that he will follow the usual practice and lay it on the Table of the House.

Photo of Mr Edward Burgin Mr Edward Burgin , Luton

As I intimated, I am not quoting from an official document, but referring to a clause in an agreement dated 5th July, 1932, that was made between the United Kingdom Tanning Industries on the one hand and the Canadian Tanning Industries on the other, and I was giving the Committee the information with regard to this agreement. The whole point of the speech of the hon. Member who moved the Amendment and of the hon. Members who supported it was that the information with regard to this agreement appears to be a little sketchy. I was endeavouring to comply with the Committee's request for information, and I was pointing out that here was a bargain between two groups of industrialists in an industry in which British industry was very greatly dependent upon the Canadian. I entirely subscribe to what the hon. Member said, that there was very little production of patent leather in this country. I gave the reasons in the previous discussion; it has something to do with the sun and the rapidity of drying the leather, which necessitates a softer climate. The Clause which I was reading stipulated the advantages which the Canadian industry proposed to invite the Canadian Government to give to the British exporter if the British Government gave to the Canadian exporter equivalent advantages. That was a bargain made between these two groups of people.

Photo of Sir Stafford Cripps Sir Stafford Cripps , Bristol East

Can we know what the advantages were?

Photo of Mr Edward Burgin Mr Edward Burgin , Luton

I was about to give them when the hon. and learned Gentleman interrupted me. The advantages were: to recommend that the Canadian Government should reduce the British preferential rate of 15 per cent. ad valorem to the former British preferential tariff rate under tariff item 604 of 121/2 per cent., which was in effect down to the end of 1st June, 1931; and to recommend that the intermediate and general tariff rate of Canada be increased to 27½ per cent. ad valorem so as to give the United Kingdom leather producers a protective tariff spread in the Canadian market equal to 15 per cent. ad valorem. I did not make the agreement nor draft it; I am merely giving to the Committee the terms of the material clause. It was an agreement between the two tanning industries, which they thought it worth while to make, and under which there were mutual obligations and mutual advantages. The Canadian Government put their part of the bargain into operation, and the advantages which were sought for by the British tanning industry were granted. By an accident, the British delegates negotiating at the Ottawa Conference were not aware of this discussion between the industries, and so the Ottawa Agreements were concluded without there being inserted in the list of obligations which the British Parliament were to undertake those implementing this agreement made by the British tanning industry. We had, therefore, this position, that an agreement, not binding on either Government, had been implemented by the Canadian Government, providing for a 15 per cent. preference in the Canadian market, and that there was no corresponding provision in British legislation to bring about the suggested preference.

The matter went before the Import Duties Advisory Committee. It appeared to be a matter that came within the competence of that committee, and they listened to the evidence and they wrote the letter which the hon. and learned Member for East Bristol (Sir S. Gripps) has read. As the hon. Member for Colne Valley (Mr. Mallalieu) rightly said, the Import Duties Advisory Committee are required by Section 3, Sub-section (2) of the Import Duties Act, 1932, when considering what recommendations they are to make, to have regard: To the advisability in the national interest and to the interests generally of trade and industry in the United Kingdom. If the avowed object of the duties is not the trade interests of the United Kingdom but the interests of the Canadian industry, it is contended that the case falls outside Section 3, Sub-section (2) of the Act, and consequently the Advisory Committee were not able to make a recommendation. Hon. Members are entitled to say that that is argument, that that is a gloss, that it is supposition. I can only give to the Committee the explanation which I believe to be both true and accurate. The Advisory Committee are an independent body. They make recommendations, or they write intimating that they are not doing so. It is open to hon. Members to think that the letter which has been read amounts to a rejection, it is open to them to imagine that the evidence did not satisfy the Committee, but, quite clearly, the facts are equally open to the explanation which I have given, and that is the explanation which the Government have accepted, and is the reason for the Government's action in inserting this Clause in this Bill.

The matter was very carefully considered. The Canadian Government had given a concession under terms which implied that the United Kingdom were to place duties on foreign patent leather, and those duties had not been put on. Although the greatest reluctance was felt, having regard to what had occurred, the conclusion was reached that, in order that there should be no question of our good faith, and with a view to consolidating good commercial relations between the United Kingdom and Canada, the wishes of the Canadian Government, frequently emphasised by representations, should be met. It appeared the more desirable to do this because the Canadian Government have shown themselves increasingly ready to meet our wishes in other matters. The hon. Member for Colne Valley has referred to the interim Textile Report, of which some forecast has been given in the Press. That report has not yet come to hand, and consequently there has been no opportunity of examining it, but I can tell the Committee that the Canadian Government have restored free entry for fine cotton goods, and has extended to linen goods embroidered with cotton the free entry granted under the Ottawa Agreement respecting linen goods; and, more recently, in the Canadian Budget the most important item was the reduction from 3 per cent. to 1½ per cent., in the case of British goods only, of the excise on the duty-paid value of imported goods.

I do not want to exaggerate these things and on the other hand, I do not want to minimise them, but I want this Committee to know that in the considered opinion of the Government handling this matter the Canadian Government have shown an increasing tendency to help British industry, and that it would be particularly unfortunate if any suggestion, were allowed to gain currency that we were not willing to implement an agreement and a bargain arrived at between groups of manufacturers where it had been put into operation. It has been suggested that we are going behind the Import Duties Advisory Committee, but that is no more the case than with any of the Ottawa duties. The Ottawa duties are outside the purview of that committee. The Ottawa duties were imposed in return for tariff concessions from the Dominions. The remainder of this Clause—though this perhaps is not germane to the Amendment—is to show that this is an Ottawa duty exactly as if it had been dealt with in the general discussions made at the time.

I have given hon. Members a frank, complete and open explanation. Nobody likes the position. It is not pleasant to impose a duty where there is very little horn manufacture to protect. I think the question whether the manufacturer of patent leather at home cannot be considerably increased is worthy of some scientific discussion. The hon. Member who moved the Amendment said that recently the number of those manufacturing it had increased, although he mentioned quite a small number. However that may be, the facts are as I have stated. We have put this duty into the Finance Bill instead of passing it through the Import Duties Advisory Committee because we believe it to be outside the scope of Section 3, Sub-section (2) of the Act of 1932—we do not believe it is against the "interest of British industry" that this should be done—and it is to implement a matter of Government policy.

7.37 p.m.

Photo of Sir Stafford Cripps Sir Stafford Cripps , Bristol East

The hon. Gentleman has now given us a very much fuller explanation than we had at any earlier period. He now tells us, I think I am right in saying for the first time, that the Canadian Government have been pressing many times for this duty to be put on. Certainly I was not aware of that fact, but that hardly alters the criticism of this Clause. The matter was allowed to be referred to the Import Duties Advisory Committee, it was heard by them, and they decided that, for the present at any rate, it was not in the national interest or in the interests generally of the trade of the United Kingdom that this duty should be imposed, and therefore they did not impose it. The hon. Gentleman said that this has nothing to do with the interests of the United Kingdom, and that under the Ottawa Agreements duties are imposed merely for the purpose of getting concessions in Canada for other industries.

Photo of Mr Robert Bourne Mr Robert Bourne , Oxford

The discussion on this Amendment has become rather wide, but I think necessarily rather wide, and I want to safeguard myself against a repetition of these arguments on the Question, "The Clause stand part of the Bill." It is obvious that this is rather a difficult matter and I think it would be better to discuss it generally on the Amendment.

Photo of Sir Stafford Cripps Sir Stafford Cripps , Bristol East

I agree, except for one or two technical matters which follow on the rest of the Clause. This Clause is apparently designed not to benefit the patent leather industry, but, by reason of an exchange of concessions, to benefit some other industry. That may be all very well where the Government have carefully considered the interests of other industries—for instance, if they had consulted the boot and shoe industry—to see whether this is a proper arrangement, but no such thing has been done here, and that is the great objection of this Clause. Here are two sets of manufacturers—the manufacturers interested in patent leather being one single firm—who go to Canada and enter into an agreement, as part of the British tanning industry, with the Canadian tanning industry, without the representatives of the Government knowing anything at all about it. This British tanning industry is now, apparently, to be allowed to affect any other industry in this country, without there being any control over it. Once it has entered into the arrangement with the Canadian tanning industry, a pistol is pointed at the head of our Government and they are told, "You have got to comply with this, because we have pledged our word." The Canadian tanners' arrangement, which might happen to be extremely favourable to the Canadian tanners, is implemented and then they turn round and say, "You have got to do your part of the bargain." But it never was our bargain at all, but the bargain of someone in the industry, and I certainly am not prepared to leave bargaining over the tariff interests of this country in the hands of the tanners or any other vested interest. It is bad enough when it is done by a National Government, and we do not want it done by vested interests individually, irrespective of all the other interests in the country. The hon. Gentleman knows from his experience of these tariff bargains that a multitude of interests come into these questions, directly and indirectly, but none of them were considered in this case by the people who made the agreement. The only people who were considered were the tanning interests in the two countries.

Photo of Mr Edward Burgin Mr Edward Burgin , Luton

If there were a case in which a pistol was put at the head of the Government and we were obliged to implement an agreement arrived at between two sets of industrialists for reasons which might be beneficial to their own industry or because it would hurt some other industry, such a proceeding would be open to grave objection; but, of course, the examination which the hon. and learned Gentleman said did not take place has been undertaken prior to the decision to insert this Clause in the Finance Bill.

Photo of Sir Stafford Cripps Sir Stafford Cripps , Bristol East

I am afraid that really will not help the hon. Gentleman. Having had the pistol presented at his head, he has been able to think out some quite good reasons why he should do what the man with the pistol asks him to do—that is always simple, after the event—but I would much prefer that the hon. Gentleman had decided before whether he would like the pistol to be put to his head. He would have had a much freer judgment as to the whole of the circumstances of the case, and this method, as he says, is liable to abuse, and at least is a clumsy and inept method, because it leaves out of account the vital interests of, in this case, the whole body of boot and shoe manufacturers. This is not for the benefit of the boot and shoe industry, because we know that the Import Duties Advisory Committee found, after inquiry, that it was not to be for the benefit of the industries of this country. But we are told that it is for the benefit of the industry of Canada, and therefore we have got to do it. I object very strongly to the implementing of this arrangement, to which we have been pledged through the industry, and not through our Government, and we on this side propose, on those grounds, to vote against this Clause.

7.45 p.m.

Photo of Mr William Leonard Mr William Leonard , Glasgow St Rollox

I want to add one or two arguments to the case which has just been put from this Front Bench, but I do not propose to go over the whole of it in detail. I agree with what has been said by the hon. and learned Member for East Bristol (Sir S. Cripps) in regard to the details which have been given by the Parliamentary Secretary to the Board of Trade; they certainly have been much more complete than they were on the previous occasion. I have before me the speech which he made, and the general impression which I received was that the proposals which we are now discussing were for the benefit of the Canadian industry. I remember a little bit of discussion which took place between the hon. Member and one of his hon. Friends behind him on the question of what was a quid pro quo. We are now informed that there are certain advantages which accrue. I regret that we have only had the details now. The advantages which are to accrue to this country require very considerable examination, and I should like to have an opportunity of giving that examination.

I cannot understand the hon. Gentleman's statement in regard to the argument that the imposition of this duty would increase the cost of shoes made from patent leather. His reply has always been that the increase would be one halfpenny per square foot or one penny per pair. As far as the duties have been applied, it has meant 2½d. and it may mean 3½d. per pair when this heavy imposition is placed upon the purchaser of shoes in this country. I would like the Parliamentary Secretary to tell us, not what one halfpenny per square foot would mean, but what it is likely to mean after it has been passed on by the manufacturers to the users. A commendable desire is shown to see our industries flourish, but I do not see how any further advantage will be given to Canada. It has been admitted in the past that a discussion took place between an industry in Canada and a firm in this country. I have been informed how the two firms came into being,;and from the evidence I think that one was a Canadian firm.

Photo of Mr Edward Burgin Mr Edward Burgin , Luton

Will the hon. Member allow me to give him one fact? In the first three months of 1934 the value of these imports was £98,000 from all sources, and of that, two-thirds was from Canada; roughly a quarter, or £25,000 of the whole came from the United States, and £7,000 worth or another 7 per cent. came from Germany. The task of supplying the home market with the quantity that we now receive from the United States and Germany offers quite a good scope.

Photo of Mr William Leonard Mr William Leonard , Glasgow St Rollox

The Canadian industry has already stated that it can increase its supplies to 19,000,000! square feet, although it is only supplying 6,000,000 square feet. There is not much hope for the home industry, and I do not think that the action which is now being taken will strengthen it to any degree. It may give a further advantage to Canada. I do not see much chance of the hon. Gentleman's opinion on this matter fructifying. The interests which use this commodity have been given representation of a very tangible and detailed character.

7.50 p.m.

Photo of Mr Frank Griffith Mr Frank Griffith , Middlesbrough West

The hon. and learned Member for East Bristol (Sir S. Cripps) described the process by which this duty has been imposed as levelling a pistol at the head of the Government, and the Parliamentary Secretary rose and refuted that statement; but it was all taken from his own speech, which is very fresh in the minds of the Committee. He said in my hearing that it was not a pleasant thing to impose a duty when there would be no substantial benefit to the industry here, and he went on to say that it had to be done because there was the bargain, the history of which he had described in some detail. The Canadian Government had implemented it, and we must not be thought not to be doing our part. If that is not putting a pistol to the head of the Government. I do not know what is. It means that the decision has been taken already by somebody else before the Government starts to review the question at all. Afterwards the Government may find reasons. It is perhaps not quite so unpleasant as the Parliamentary Secretary thought, but unpleasant in some way it must certainly be.

I want to ask how far these new sources and causes of tariffs are to go. We have the Import Duties Act, which is checked to some extent by the presence of a statutory body who investigate the benefit of import duties to English industries. There are also the Ottawa Agreements which go beyond that, taking as they do the wider view and considering imperial interests. Now we are to have action which considers neither national nor imperial, but purely sectional, interests. That is the most dangerous thing that we have seen yet. How far is it to be carried? It is open to any group of manufacturers to make an agreement like this, and the agreement may be harmful or corrupt, but, if it suits somebody on the other side to adopt it, the British Government will come to us helplessly and say, "Whatever are we to do? We have to pass this." We ought to know where to stop. We all desire to consider national and imperial interests, but in face of what has been said by the Parliamentary Secretary the imperial interest was not a very substantial one. On his own figures, Canada were supplying about two-thirds of the imports into this country and they were doing pretty well out of the previous assistance. I wonder at their temerity for asking for further artificial assistance.

I make my protest against a dangerous practice in a hole-and-corner way. The Government either never knew about it or forgot it at Ottawa, and yet we are asked to bind ourselves by what has been done by a group of sectional interests. If that is to go on, the corrupt effect of tariffs may be worse than have always been imagined by Free Traders.

Question put, "That 'fifteen' stand part of the Clause."

The Committee divided: Ayes, 221; Noes, 48.

Division No. 262.]AYES.[5.37 p.m.
Acland-Troyte, Lieut.-ColonelClarke, FrankGuinness, Thomas L. E. B.
Adams, Samuel Vyvyan T. (Loeds, W.)Clarry, Reginald GeorgeGunston, Captain D. W.
Agnew, Lieut.-Com. P. G.Clayton, Sir ChristopherHacking, Rt. Hon. Douglas H.
Albery, Irving JamesCobb, Sir CyrilHales, Harold K.
Allen, Lt.-Col. J. Sandeman (B'k'nh'd.)Cochrane, Commander Hon. A. D.Hamilton, Sir George (llford)
Allen, William (Stoke-on-Trent)Colfox, Major William PhilipHannon, Patrick Joseph Henry
Anstruther-Gray, W. J.Collins, Rt. Hon. Sir GodfreyHartland, George A.
Applin, Lieut.-Col. Reginald V. K.Conant, R. J. E.Harvey, Major S. E. (Devon, Totnes)
Bailey, Eric Alfred GeorgeCook, Thomas A.Haslam, Henry (Horncastle)
Baldwin, Rt. Hon. StanleyCooke, DouglasHeadlam, Lieut.-Col. Cuthbert M.
Baldwin-Webb, Colonel J.Courtnope, Colonel Sir George L.Hellgers, Captain F. F. A.
Balfour, Capt. Harold (I. of Thanet)Cranborne, ViscountHenderson, Sir Vivian L. (Chelmsford)
Barclay-Harvey, C. M.Crooke, J. SmedleyHeneage, Lieut.-Colonel Arthur P.
Barrie, Sir Charles CouparCrookshank, Col. C. de Wlndt (Bootle)Hepworth, Joseph
Barton, Capt. Basil KelieyCrookshank, Capt. H. C. (Galnsb'ro)Hills, Major Rt. Hon. John Waller
Beauchamp, Sir Brograve CampbellCulverwell, Cyril TomHore-Bellsha, Leslie
Beaumont, M. W. (Bucks., Aylesbury)Dalkeith, Earl ofHorsbrugh, Florence
Beaumont, Hon. R. E. B. (Ports-n'th, C.)Davidson, Rt. Hon. J. C. C.Howltt, Dr. Alfred B.
Belt, Sir Alfred L.Davies, Maj. Geo. F. (Somerset, Yeovil)Hudson. Cast. A. U. M. (Hackney, N.)
Betterton, Rt. Hon. Sir Henry B.Davison, Sir William HenryHume, Sir George Hopwood
Blinded, JamesDawson, Sir PhilipHunter, Dr. Joseph (Dumfries)
Borodale, ViscountDenman, Hon. R. D.Jackson, Sir Henry (Wandsworth, C.)
Bossom, A. C.Dickie, John P.Joel, Dudley J. Barnato
Bower, Lieut.-Com. Robert TattonDower, Captain A. V. G.Jones, Lewis (Swansea, West)
Bralthwalte, J. Q. (Hillsborough)Duggan, Hubert JohnKer, J. Campbell
Broadbent, Colonel JohnDuncan, Jamas A. L. (Kensington, N.)Kerr, Lieut.-Col. Charles (Montrose)
Brocklebank, C. E. R.Dunglass. LordKerr, Hamilton W.
Brown, Col. D. C. (N'th'l'd, Hexham)Ellis, Sir R. GeoffreyKimball, Lawrence
Brown, Ernest (Leith)Elliston, Captain George SampsonKnight, Holford
Brown, Brig.-Gen. H. C. (Berks., Newb'y)Elmley, ViscountKnox, Sir Alfred
Browne, Captain A. C.Emmott, Charles E. G. C.Lamb, Sir Joseph Quinton
Buchan-Hepburn, P. G. T.Emrys-Evans, P. V.Lambert, Rt. Hon. George
Bullock, Captain MalcolmErskine-Bolst, Capt. C. C. (Blk'pool)Law, Sir Alfred
Burgin, Dr. Edward LeslieEssenhigh, Reginald ClareLaw, Richard K. (Hull, S. W.)
Burnett, John GeorgeEverard, W. LindsayLeech, Dr. J. W.
Butt, Sir AlfredFermoy, LordLeighton, Major B. E. P.
Cadogan, Hon. EdwardFox. Sir GlffordLevy, Thomas
Campbell, Sir Edward Taswell (Brmly)Fuller, Captain A. G.Lewis, Oswald
Campbell-Johnston, MalcolmGalbraith, James Francis WallaceLocker-Lampson. Rt. Hn. G. (Wd. G'n)
Caporn, Arthur CecilGanzonl, Sir JohnLockwood, Capt. J. H. (Shipley)
Carver, Major William H.Gilmour, Lt.-Col. Rt. Hon. Sir JohnLoder, Captain J. de Vere
Castlereagh, ViscountGledhill, GilbertLumley, Captain Lawrence R.
Cayzer, Sir Charles (Chester, City)Gluckstein, Louis HalleMabane, William
Cazalet, Thelma (Islington, E.)Goff, Sir ParkMacDonald, Rt. Hon. J. R. (Seaham)
Chamberlain, Rt. Hon. N. (Edgbaston)Goodman, Colonel Albert W.McEwen. Captain J. H. F.
Chapman, Col. R. (Houghton-le-Spring)Granville, EdgarMcKie, John Hamilton
Chapman, Sir Samuel (Edinburgh, S.)Grattan-Doyle. Sir NicholasMaclay, Hon. Joseph Paton
Chorlton, Alan Ernest LeofricGrimston, R. V.McLean, Major Sir Alan
McLean, Dr. W. H. (Tradeston)Reid, James S. C. (Stirling)Sueter, Rear-Admiral Sir Murray F.
Macquisten, Frederick AlexanderRemer, John R.Sugden, Sir Wilfrid Hart
Haltland, AdamRhys, Hon. Charles Arthur u.Sutcliffe, Harold
Making, Brigadier-General ErnestRuggles-Brise, Colonel E. A.Tate, Mavis Constance
Manningham-Buller, Lt.-Col. Sir M.Runge, Norah CecilThomas, Rt. Hon. J. H. (Derby)
Margesson, Capt. Rt. Hon. H. D. R.Russell, Alexander West (Tynemouth)Thompson, Sir Luke
Mariden, Commander ArthurRussell, Hamer Field (Sheffield, B'tside)Thomson, Sir Frederick Charles
Mayhew, Lieut.-Colonel JohnRutherford, John (Edmonton)Thorp, Linton Theodore
Mills, Sir Frederick (Leyton, E.)Rutherford, Sir John Hugo (Liverp'l)Todd, A. L. S. (Kingswlnford)
Mitchell, Harold P. (Br'tt'd & Chisw'k)Salmon, Sir IsldoreTouche, Gordon Cosmo
Mitchell, Sir w. Lane (Streatham)Salt, Edward W.Train, John
Monsell. Rt. Hon. Sir B. EyresSamuel, Sir Arthur Michael (F'nham)Tree, Ronald
Morgan, Robert H.Sandeman, Sir A. N. StewartTryon, Rt. Hon. George Clement
Morris-Jones, Dr. J. H. (Denbigh)Sanderson, Sir Frank BarnardTufnell, Lieut. Commander R. L.
Moss, Captain H. J.Sassoon, Rt. Hon. Sir Philip A. G. D.Wallace, Captain D. E. (Hornsey)
Muirhead, Lieut.-Colonel A. J.Savery, Samuel ServingtonWallace, John (Dunfermline)
Munro, PatrickScone, LordWard, Irene Mary Bewick (Wallsend)
Nation, Brigadier-General J. J. H.Selley, Harry R.Warrender, Sir Victor A. G.
Nicholson, Godfrey (Morpeth)Shakespeare, Geoffrey H.Wayland, Sir William A.
Nicholson, Rt. Hn. W. G. (Petersfld)Shaw, Helen B. (Lanark, Bothwell)Wedderburn, Henry James Scrymgeour.
Normand, Rt. Hon. WilfridShaw, Captain William T. (Forfar)Wells, Sidney Richard
Ormsby-Gore, Rt. Hon. William G. A.Simon, Rt. Hon. Sir JohnWeymouth, Viscount
Peake, Captain OsbertSkelton, Archibald NoelWhyte, Jardine Bell
Pearson, William G.Smithers, Sir WaldronWilliams, Charles (Devon, Torquay)
Peat, Charles U.Somervell, Sir DonaldWilliams, Herbert G. (Croydon, S.)
Percy, Lord EustaceSomerville, Annesley A. (Windsor)Willoughby de Eresby, Lord
Petherick, M.Sotheron-Estcourt, Captain T. E.Wilson, Lt.-Col. Sir Arnold (Hertfd)
Pike, Cecil F.Southby, Commander Archibald R. J.Wilson, Clyde T. (West Toxteth)
Power, Sir John CecilSpencer, Captain Richard A.Wilson, G. H. A. (Cambridge U.)
Pownall, Sir AsshetonSpender-Clay, Rt. Hon. Herbert H.Weimer, Rt. Hon. Viscount
Raikes, Henry V. A. M.Spens, William PatrickWomersley, Sir Walter James
Ramsay, Capt. A. H. M. (Midlothian)Stanley Hon. O. F. G. (Westmorland)
Ramsay, T. B. W. (Western Isles)Stewart, J. H. (Fife, E.)TELLERS FOR THE AYES.—
Rawson, Sir CooperStrauss, Edward A.Sir George Penny and Lieut.-
Ray, Sir WilliamStuart, Hon. J. (Moray and Nairn)Colonel Sir A. Lambert Ward.
Reed, Arthur C. (Exeter)Stuart, Lord C. Crichton.
NOES.
Acland, Rt. Hon. Sir Francis DykeGriffiths, George A. (Yorks. W. Riding)Pickering, Ernest H.
Banfield, John WilliamGrundy, Thomas W.Rea, Walter Russell
Batey, JosephHall, George H. (Merthyr Tydvil)Rothschild, James A. de
Brown, C. W. E. (Notts. Mansfield)Hamilton, Sir R. W. (Orkney & Zetl'nd)Sinclair, Maj. Rt. Hn. Sir A. (C'thness)
Cocks, Frederick SeymourHarris, Sir PercySmith, Tom (Normanton)
Cove, William G.Haldsworth, HerbertThorne, William James
Cripps, Sir StaffordJohnstone, Harcourt (S. Shields)Tinker, John Joseph
Daggar. GeorgeJones, J. J. (West Ham, Silvertown)West, F. R.
Dobble, WilliamJones, Morgan (Caerphilly)Williams, David (Swansea, East)
Edwards, CharlesLawson, John JamesWilliams, Edward John (Ogmore)
Foot. Dingle (Dundee)Llewellyn-Jones, FrederickWilliams, Dr. John H. (Llanelly)
Gardner, Benjamin WalterLogan, David GilbertWilliams, Thomas (York. Don Valley)
George, Megan A. Lloyd (Anglesea)Lunn, WilliamWilmot, John
Greenwood, Rt. Hon. ArthurMainwaring, William HenryWood, Sir Murdoch McKenzie (Banff)
Grenfell, David Rees (Glamorgan)Mallalieu, Edward Lancelot
Griffith, F. Kingsley (Middlesbro'. W.)Mason, David M. (Edinburgh, E.)TELLERS FOR THE NOES.—
Mr. G. Macdonald and Mr. Groves.

Question, "That the Clause stand part of the Bill," put, and agreed to.

Division No. 263.]AYES.[7.55 p.m.
Acland-Troyte, Lieut.-ColonelGrimston, R. V.Rankin, Robert
Adams, Samuel Vyvyan T. (Leeds, W.)Griffen. W. G. HowardRawson, Sir Cooper
Agnew, Lieut.-Com. P. G.Guinness, Thomas L. E. B.Ray, Sir William
Albery, Irving JamesGunston, Captain D. W.Reed, Arthur C. (Exeter)
Allen, Sir J. Sandeman (L'pool, w.)Hales, Harold K.Reid, James S. C. (Stirling)
Allen, William (Stoke-on-Trent)Hamilton, Sir George (llford)Remer, John R.
Apsley, LordHammersley, Samuel S.Ropner, Colonel L.
Atholl, Duchess ofHanbury, CecilRosbotham, Sir Thomas
Balley, Eric Alfred GeorgeHannon, Patrick Joseph HenryRoss, Ronald D.
Baillie, Sir Adrian W. M.H arbor d, ArthurRoss Taylor, Walter (Woodbridge)
Baldwin, Rt. Hon. StanleyHartland, George A.Ruggles-Brlse, Colonel E. A.
Baldwin-Webb, Colonel J.Haslam, Henry (Horncastle)Runge, Norah Cecil
Balniel, LordHeadlam, Lieut.-Col. Cuthbert M.Russell, Hamer Field (Sheffield, B'tside)
Banks, Sir Reginald MitchellHellgers, Captain F. F. A.Rutherford, Sir John Hugo (Liverp'l)
Barclay-Harvey, C. M.Henderson, Sir Vivian L. (Chelmsf'd)Salt, Edward W.
Beauchamp, Sir Brograve CampbellHepworth, JosephSamuel, Sir Arthur Michael (F'nham)
Beaumont, M. W. (Bucks., Aylesbury)Hills, Major Rt. Hon. John WalterSandeman, Sir A. N. Stewart
Belt, Sir Alfred L.Hore-Belisha, LeslieSanderson, Sir Frank Barnard
Blinden, JamesHornby, FrankSassoon, Rt. Hon. Sir Philip A. G. D.
Borodale, ViscountHorobin, Ian M.Selley, Harry R.
Boyd-Carpenter, Sir ArchibaldHorsbrugh, FlorenceShaw, Helen B. (Lanark. Bothwell)
Broadbent, Colonel JohnHudson. Capt. A. U. M. (Hackney, N.)Shaw, Captain William T. (Forfar)
Brown, Col. D. C. (N'th'l'd., Hexham)Hume. Sir George HopwoodShepperson, Sir Ernest w.
Brown, Ernest (Leith)Hunter, Dr. Joseph (Dumfries)Simmonds, Oliver Edwin
Browne, Captain A. C.Hurst, Sir Gerald B.Smith, Louis W. (Sheffield, Hallam)
Buchan-Hepburn, P. G. T.Hutchison, W. D. (Essex, Romf'd)Smithers, Sir Waldron
Burgin, Dr. Edward LeslieJackson, Sir Henry (Wandsworth, C.)Somervell, Sir Donald
Burnett, John GeorgeJesson, Major Thomas E.Somerville, Annesley A. (Windsor)
Cadogan, Hon. EdwardJones, Sir G. W. H. (Stoke New'gton)Somerville, D. G. (Willesden, East)
Campbell, Sir Edward Taswell (Brmly)Jones, Lewis (Swansea, West)Soper, Richard
Caporn, Arthur CecilKimball, LawrenceSotheron-Estcourt, Captain T. E.
Carver, Major William H.Knight, HolfordSouthby, Commander Archibald R. J.
Cayzer, Sir Charles (Chester, City)Knox, Sir AlfredSpencer, Captain Richard A.
Cazalet, Thelma (Islington, E.)Lamb, Sir Joseph QuintonSpender-Clay, Rt. Hon. Herbert H.
Chamberlain, Rt. Hon. N. (Edgbaston)Law, Sir AlfredSpens, William Patrick
Chapman, Col. R. (Houghton-le-Spring)Law, Richard K. (Hull, S. W.)Stanley, Rt. Hon. Lord (Fylde)
Clarry, Reginald GeorgeLeckle, J. A.Stanley, Hon. O. F. G (Westmorland)
Clayton, Sir ChristopherLeech, Dr. J. W.Stewart, J. H. (Fife. E.)
Cobb, Sir CyrilLevy, ThomasStourton, Hon. John J.
Cochrane, Commander Hon. A. D.Llewellin, Major John J.Strauss, Edward A.
Colfox. Major William PhilipLockwood, John C. (Hackney. C.)Sugden, Sir Wilfrid Hart
Colville, Lieut.-Colonel J.Lockwood. Capt. J. H. (Shipley)Summersby, Charles H.
Conant, R. J. E.Loder, Captain J. de VereSutcllffe, Harold
Cook, Thomas A.McEwen, Captain J. H. F.Tate, Mavis Constance
Cooke, DouglasMcKie, John HamiltonThomas, James P. L. (Hereford)
Courtauld, Major John SewellMaclay, Hon. Joseph PatonThompson, Sir Luke
Courthope, Colonel Sir George L.McLean, Major Sir AlanThomson, Sir Frederick Charles
Craven-Ellis, WilliamMcLean, Dr. W. H. (Tradeston)Thorp, Linton Theodore
Crooke, J. SmedleyMacquisten, Frederick AlexanderTodd, A. L. S. (Kingswlnford)
Crookshank, Capt. H. C. (Galnsb'ro)Manningham-Buller, Lt.-Col. Sir M.Touche, Gordon Cosmo
Cruddas, Lieut.-Colonel BernardMargesson, Capt. Rt. Hon. H. D. R.Train, John
Davies, Maj. Geo. F. (Somerset, Yeovll)Marsden, Commander ArthurTufnell, Lieut.-Commander R. L.
Dawson, Sir PhilipMartin, Thomas B.Turton, Robert Hugh
Denman, Hon. R. D.Mayhew, Lieut.-Colonel JohnWallace, John (Dunfermline)
Duncan, James A. L. (Kensington, N.)Mitchell, Harold P. (Br'tf'd & Chisw'k)Ward, Irene Mary Bewick (Wallsend)
Dunglass, LordMonsell. Rt. Hon. Sir B. EyresWarrender, Sir Victor A. G.
Ellis. Sir R. GeoffreyMorgan, Robert H.Wedderburn, Henry James Scrymgeour.
Elmley, ViscountMorris-Jones, Dr. J. H. (Denbigh)Wells, Sydney Richard
Emmott, Charles E. G. C.Morrison, G- A. (Scottish Univer'ties)Weymouth, Viscount
Emrys-Evans, P. V.Moss. Captain H. J.Whyte, Jardine Bell
Entwistle, Cyril FullardMunro, PatrickWilliams, Herbert G. (Croydon, S.)
Erskine-Bolst, Capt. C. C. (Blk'pool)Nation, Brigadier-General J. J. H.Willoughby de Eresby, Lord
Essenhigh, Reginald ClareNicholson, Rt. Hn. W. G. (Petersf'ld)Wilson, Clyde T. (West Toxteth)
Everard, W. LindsayNormand. Rt. Hon. WilfridWilson, G. H. A. (Cambridge U.)
Fleming, Edward LascellesPeake, Captain OsbertWinterton, Rt. Hon. Earl
Fox, Sir GilfordPearson, William G.Wise, Alfred R.
Fuller, Captain A. G.Peat, Charles U.Withers, Sir John James
Ganzont. Sir JohnPercy, Lord EustaceWolmer, Rt. Hon. Viscount
Gillett. Sir George MastermanPetherick, M.Womersley, Sir Walter James
Gledhill. GilbertPeto, Geoffrey K. (W'verh'pt'n, Bilston)Worthington, Dr. John V.
Gluckstein, Louis HallePike, Cecil F.
Gower, Sir RobertPownall, Sir AsshetonTELLERS FOR THE AYES.—
Greaves-Lord, Sir WalterRadford, E. A.Sir George Penny and Lieut.-
Greene, William P. C.Ralkes, Henry V. A. M.Colonel Sir A. Lambert Ward.
Grenfell, E. C. (City of London)Ramsay, T. B. W. (Western Isles)
NOES.
Acland, Rt. Hon. Sir Francis DykeBrown, C. W. E. (Notts., Mansfield)Daggar, George
Adams, D. M. (Poplar, South)Cocks, Frederick SeymourEdwards, Charles
Banfield, John WilliamCove, William G.Foot, Dingle (Dundee)
Batey, JosephCripps, Sir StaffordGardner, Benjamin Walter
Bernays, RobertCurry, A. C.George, Megan A. Lloyd (Anglesea)
Greenwood, Rt. Hon. ArthurJones, Henry Haydn (Merioneth)Sinclair, Maj. Rt. Hn. Sir A. (C'thness)
Grenfell, David Rees (Glamorgan)Jones, Morgan (Caerphilly)Smith, Tom (Normanton)
Griffith, F. Kingsley (Mlddlesbro', W.)Lawson, John JamesThorne, William James
Griffiths, George A. (Yorks, W. Riding)Leonard, WilliamTinker, John Joseph
Griffiths, T. (Monmouth, Pontypool)Lunn, WilliamWest, F. R.
Grundy, Thomas W.Maclean, Nell (Glasgow, Govan)Williams, David (Swansea, East)
Hall, George H. (Merthyr Tydvil)Mainwaring, William HenryWilliams, Dr. John H. (Llanelly)
Hamilton, Sir R. W. (Orkney & Zetl'nd)Mallalleu, Edward LancelotWilliams, Thomas (York. Don Valley)
Harris, Sir PercyMason, David M. (Edinburgh, E.)Wilmot, John
Holdsworth, HerbertMilner, Major James
Jenkins, Sir WilliamOwen, Major GoronwyTELLERS FOR THE NOES.—
Johnstone, Harcourt (S. Shields)Rea, Walter RussellMr. Groves and Mr. G. Macdonald.

Photo of Mr Robert Bourne Mr Robert Bourne , Oxford

With regard to the next Amendment, in the name af the hon. Member for Caerphilly (Mr. Morgan Jones)—in page 5, to leave out lines 6 to 12—I have decided that it would impose a charge. Perhaps, however, the hon. Member's object is to ask a question, and, if that be the case, he can do so on the Question, "That the Clause stand part of the Bill."

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

8.3 p.m.

Photo of Mr Morgan Jones Mr Morgan Jones , Caerphilly

As you rightly observe, Captain Bourne, the purpose of my Amendment is really to elucidate the meaning of this Clause. There are two points which I should like to put to the Parliamentary Secretary. In the first portion of Sub-section (1) we are told that a Customs duty is to be imposed upon patent leather, and then there is a proviso which says that it shall not apply to any goods which fall within a certain class or category, that class or category being goods which are provided for in the Import Duties Act. I would like to know what patent leather is in fact taxed with an additional duty under the Import Duties Act. As far as I remember, there is none, but, if the Parliamentary Secretary can throw some light upon that matter for me, I shall be very glad.

The other point is a little more difficult for me even to put to the Parliamentary Secretary. As I understand it, Subsection (1) of Section 1 of the Ottawa Agreements Act provides for the imposition of duties in accordance with the Ottawa Agreements. If I have grasped aright the purpose of the proviso to Subsection (2), what is proposed is really to substitute some other method of doing what appears to me to be the same thing. I do not know if I have grasped the point correctly, but, if the Government are in fact proposing a new method for doing the same thing, there ought surely to be some explanation for it, and I shall be very glad if the Parliamentary Secretary can throw some light upon what, I confess, is to me a somewhat abstruse problem

8.6 p.m.

Photo of Mr Harcourt Johnstone Mr Harcourt Johnstone , South Shields

I am glad to see that the Chancellor of the Exchequer is now in his place, because I should like to offer an observation or two upon the extraordinary variety of methods of imposing taxation which we have seen hitherto. The first duty with which we dealt was that on arc lamp carbons, and hon. Members consistently pressed for an inquiry into that duty. The Chancellor refused. Indeed, he gave no answer at all, but left it to the Parliamentary Secretary to reply by arguments which no impartial Committee was to have the opportunity of testing. No actual evidence was given, nor were we able to hear what were the opinions of the interested parties.

We passed on to the question of insulin, on which the Chancellor of the Exchequer adopted an entirely different attitude. There it was a question of abolishing the duty, and there the Chancellor of the Exchequer in his reply was, as far as I could understand it, glad to welcome the fact that those who were interested in the manufacture of insulin would be able, if he were taking off the duty to-day, to make application to the Tariff Advisory Committee, and, if that Committee advised that a duty was desirable, he, the Chancellor of the Exchequer, would not resist making an Order. That was the second point of view. It was an occasion on which an inquiry might result in the imposition of a duty, and, therefore, it was welcome. In the first case an inquiry might result in a duty not being imposed, and, therefore, it was not granted.

The present case is an extraordinary one, and, I hope, unique. Here we have another example of all open inquiry being refused. I do not know exactly what the circumstances were—the Parliamentary Secretary has not explained them—in which the trade interests concerned forgot in some extraordinary way to mention to the Board of Trade that they had ever made this agreement. I cannot conceive of any trade delegation, even if it only represented a small industry like that of patent leather, being so incredibly incompetent as to forget to mention to the Board of Trade or the Treasury She fact that they had made an agreement to which, apparently, they expected the Treasury to give effect by imposing a duty, and that it should have escaped the notice of the Government is really a most remarkable thing. But that does not deter them now, after 18 months or more, from proposing the duty that is provided for in this Clause. I should have thought, after what the Parliamentary Secretary has said as to his reluctance to impose a duty, that he would have taken some opportunity to have an inquiry, even if it were not carried out by the Tariff Advisory Committee. Inquiries are not limited to the Tariff Advisory Committee; the hon. Gentleman, or the President of the Board of Trade, is at perfect liberty to gather together any body he likes to advise him about anything he likes, and I should have thought that in a case of this kind, where he admits that the people principally concerned, namely, the boot and shoe industry, are opposed to the duty, and the people in favour of it are only a tiny trade, he would at least have taken an opportunity of getting independent advice before going so far as to impose what he himself admits is an unwelcome duty.

In spite of all the arguments of the Parliamentary Secretary as to the necessity of carrying out the undertaking mutually given by these two interests, I shall have no hesitation in voting against the Clause, and I hope that if in future the Chancellor of the Exchequer has occasion in his Budget to impose further duties of which the source and origin remain to some extent wrapped in mystery, he will adopt the method of having some kind of inquiry by some sort of impartial body. It is no good saying that the Tariff Advisory Committee is not competent on this, that or any other occasion to inquire into a duty; there are plenty of other methods of inquiry; and I hope that in this Finance Bill we have seen the last of tariffs which are imposed without inquiry and which give rise to suspicion which may be right or may be wrong, but which it is a pity should exist in the minds of any Members of the Committee.

8.12 p.m.

Photo of Mr Edward Burgin Mr Edward Burgin , Luton

The hon. Member for Caerphilly (Mr. Morgan Jones) has asked me to assist him by explaining the dovetailing of some of the parts of Clause 6, and, in particular, to give some explanation as to their meaning and general effect. The main operative part of Clause 6 imposes a duty, not only on patent leather, but on goods composed wholly of patent leather. That is, perhaps, precautionary. It is designed to avoid any question as to the proper amount of duty to be charged on those articles, The duty does not apply to articles which contain patent leather as a component—for instance, a handbag. The proviso, that is to say, lines 6 to 12, is necessary because of Sub-section (4, b) of Section 1 of the Ottawa Agreements Act, 1932. Where an Ottawa duty is in force, all additional duties cease to apply. If you are going to make the duty on patent leather an Ottawa duty, it would automatically, under the Ottawa Agreements Act. make other additional duties cease to apply.

In order to prevent that happening, you must say that Sub-section (4, b) of Section 1 of the Ottawa Agreements Act shall not apply to that particular duty. That is so in this case because there is an existing duty higher than 15 per cent. on certain forms of patent leather. The hon. Member asked me to give him one or two examples. Shaped parts for making up into boots and shoes are subject, under an Additional Import Duties Order, to a duty of 20 per cent. ad valorem, that is to say, the 10 per cent. general ad valorem duty plus an additional 10 per cent. Without this proviso, the effect of making the 15 per cent. duty under this Clause an Ottawa duty would be to prevent the already existing 20 per cent. duty from applying any longer. Sub-section (2) places the new duty in substantially the same position as those imposed under the Ottawa Agreements Act, and, as the new duty is partly the outcome of the Ottawa Conference, it is desirable that that should be the case, and that preference and drawback and all that sort of thing, which applies to Ottawa duties, should apply to this duty. The proviso to the second Sub-section says that Section 1 (2) of the Ottawa Agreements Act shall not apply, but that the duty shall lapse if the agreement with Canada lapses. The Subsection of the Ottawa Agreements Act referred to says that the duties chargeable under that Act must be repealed whenever they can be repealed without affecting the Ottawa Agreements. As here we have not an Ottawa Agreement, this duty could be repealed immediately

under the Ottawa Agreements Act. You, therefore, have to adapt the Ottawa Agreements Act, 1932, because there is no agreement under which this duty is included. If the hon. Gentleman is not satisfied, it is not my fault that I have not trade the position clear.

Question put, "That the Clause stand part of the Bill."

The Commiteee divided; Ayes 206; Noes 49.

Division No. 264.]AYES.[8.18 p.m.
Acland-Troyte, Lieut.-ColonelGledhill, GilbertMoss, Captain H. J.
Adams, Samuel Vyvyan T. (Leeds, W.)Gluckstein, Louis HalleMunro. Patrick
Agnew, Lieut.-Com. P. G.Gower, Sir RobertNation, Brigadier-General J. J. H.
Albery, Irving JamesGreaves-Lord, Sir WalterNormand, Rt. Hon. Wilfrid
Allen, Sir J. Sandeman (Liverp'l, W.)Greene, William P. C.Peake, Captain Osbert
Allen, William (Stoke-on-Trent)Grimston, R. V.Pearson, William G.
Apsley, LordGritten, W. G. HowardPenny, Sir George
Atholl, Duchess ofGuinness, Thomas L. E. B.Percy. Lord Eustace
Bailey, Eric Alfred GeorgeGunston, Captain D. W.Petherick, M.
Balllie. Sir Adrian W. M.Hales, Harold K.Peto, Geoffrey K. (Wverh'pt'n, Bilston)
Baldwin, Rt. Hon. StanleyHammersley, Samuel S.Pike, Cecil F.
Baldwin-Webb, Colonel J.Hanbury, CecilPownall, Sir Assheton
Balniel, LordHannon, Patrick Joseph HenryRadford, E. A.
Barclay-Harvey, C. M.Harbord, ArthurRalkes, Henry V. A. M.
Barrie, Sir Charles CouparHartland, George A.Ramsay, T. B. W. (Western Isles)
Beauchamp, Sir Brograve CampbellHaslam, Henry (Horncastle)Rankin, Robert
Belt. Sir Alfred L.Headlam, Lieut.-Col. Cuthbert M.Ray, Sir William
Blindell, JamesHellgers, Captain F. F. A.Reed, Arthur C. (Exeter)
Boulton, W. W.Henderson, Sir Vivian L. (Chelmsford)Reid, James S. C. (Stirling)
Braithwalte, J. G. (Hillsborough)Hepworth, JosephRemer, John R.
Broadbent, Colonel JohnHills, Major Rt. Hon. John WallerRopner, Colonel L.
Brown, Col. D. C. (N'th'I'd., Hexham)Hornby, FrankRosbotham, Sir Thomas.
Brown, Ernest (Leith)Horobin, Ian M.Ross, Ronald D.
Browne, Captain A. C.Horsbrugh, FlorenceRoss Taylor, Walter (Woodbridge)
Buchan-Hepburn, P. G. T.Hudson, Capt. A. U. M. (Hackney, N.)Ruggles-Brise, Colonel E. A.
Burgin, Dr. Edward LeslieHume, Sir George HopwoodRunge, Norah Cecil
Burnett, John GeorgeHunter, Dr. Joseph (Dumfries)Russell, Hamer Field (Sheffield, B'tside)
Cadogan, Hon. EdwardHurst, Sir Gerald B.Rutherford, Sir John Hugo (Liverp'l)
Campbell, Sir Edward Taswell (Brmly)Hutchison, W. D. (Essex, Romford)Salt, Edward W.
Campbell-Johnston, MalcolmJackson, Sir Henry (Wandsworth, C.)Samuel, Sir Arthur Michael (F'nham)
Caporn, Arthur CecilJesson, Major Thomas E.Sandeman, Sir A. N. Stewart
Chamberlain, Rt. Hon. N. (Edgbaston)Johnston, J. W. (Clackmannan)Sanderson, Sir Frank Barnard
Chapman, Col. R. (Houghton-le-Spring)Jones, Sir G. W. H. (Stoke New'gton)Sassoon, Rt. Hon. Sir Philip A. G. D.
Clarry, Reginald GeorgeJones. Lewis (Swansea, West)Selley, Harry R.
Clayton, Sir ChristopherKimball, LawrenceShaw, Halen B. (Lanark, Bothwell)
Cobb, Sir CyrilKnight, HolfordShaw, Captain William T. (Forfar)
Cochrane, Commander Hon. A. D.Knox, Sir AlfredShepperson, Sir Ernest W.
Colfox, Major William PhilipLamb, Sir Joseph QuintonSimmonds, Oliver Edwin
Conant, R. J. E.Law, Sir AlfredSmith, Louis W. (Sheffield. Hallam)
Cook, Thomas A.Law, Richard K. (Hall, S. W.)Smith, Sir R. W. (Ab'd'n. & K'dlne, C.)
Cooke, DouglasLeckle, J. A.Smithers, Sir Waldron
Courtauld, Major John SewellLeech, Dr. J. W.Somervell, Sir Donald
Courthope, Colonel Sir George L.Lees-Jones, JohnSomerville, Anneslev A. (Windsor)
Craven-Ellis, WilliamLevy, ThomasSomerville, D. G. (Willesden, East)
Crooke, J. SmedleyLindsay, Kenneth (Kilmarnock)Soper, Richard
Croom-Johnson, R. P.Lockwood, John C. (Hackney. C.)Sotheron-Estcourt, Captain T. E.
Cruddas, Lieut.-Colonel BernardLockwood, Capt. J. H. (Shipley)Southby, Commander Archibald R. J.
Davies, Maj. Geo. F. (Somerset, Yeovil)Loder, Captain J. de VereSpencer, Captain Richard A.
Dawson, Sir PhilipMcEwen, Captain J. H. F.Spender-Clay, Rt. Hon. Herbert H.
Denman, Hon. R. D.McKie, John HamiltonSpens, William Patrick
Duncan, James A. L. (Kensington, N.)Maclay, Hon. Joseph PatonStanley, Hon. O. F. G. (Westmorland)
Dunglass, LordMcLean, Major Sir AlanStewart, J. H. (Fife, E.)
Elmley. ViscountMcLean, Dr. W. H. (Tradeston)Stourton, Hon. John J.
Emmott, Charles E. G. C.Macquisten, Frederick AlexanderStrauss. Edward A.
Emrys-Evans, P. V.Manningham-Bullor, Lt.-Col. Sir M.Sugden. Sir Wilfrid Hart
Entwistle. Cyril FullardMargesson, Capt. Rt. Hon. H. D. R.Summersby. Charles H.
Erskine-Bolst, Capt. C. C. (Blackpool)Marsden, Commander ArthurTate, Mavis Constance
Essenhigh, Reginald ClareMartin, Thomas B.Thomas, James P. L. (Hereford)
Everard, W. LindsayMayhew, Lieut.-Colonel JohnThompson, Sir Luke
Fleming, Edward LascellesMitchell, Harold P. (Br'tf'd & Chisw'k)Thomson, Sir Frederick Charles
Fuller, Captain A. G.Monsell, Rt. Hon. Sir B. EyresThorp, Linton Theodore
Ganzonl. Sir JohnMorgan, Robert H.Todd, A. L. S. (Kingswinford)
Glliett, Sir George MastermanMorrison, G. A. (Scottish Univer'tles)Touche, Gordon Cosmo
Train, JohnWedderburn, Henry James Scrymgeour.Wise, Alfred R.
Tufnell, Lieut.-Commander R. L.Wells, Sydney RichardWithers, Sir John James
Turton, Robert HughWeymouth, ViscountWorthington, Dr. John V.
Wallace, John (Dunfermline)Whyte, Jardine Bell
Ward, Lt.-Col. Sir A. L. (Hull)Williame, Herbert G. (Croydon, S.)TELLERS FOR THE AYES—
Ward, Irene Mary Bewick (Wallsend)Wilson, Clyde T. (West Toxteth)Sir Walter Womersley and Dr.
Wirrender, Sir Victor A. G.Wilson, G. H. A. (Cambridge U.)Morris-Jones.
NOES.
Acland, Rt. Hon. Sir Francis DykeGriffiths, George A. (Yorks, W. Riding)Mason, David M. (Edinburgh, E.)
Adams, D. M. (Poplar, South)Griffiths, T. (Monmouth, Pontypool)M liner, Major James
Banfield, John WilliamGrundy, Thomas W.Owen, Major Goronwy
Batey, JosephHall, George H. (Merthyr Tydvil)Rea, Walter Russell
Bernays, RobertHamilton, Sir R. W. (Orkney & Zel'nd)Sinclair, Maj. Rt. Hn. Sir A. (C'thness)
Brown, C. W. E. (Notts., Mansfield)Harris, Sir PercySmith, Tom (Normanton)
Cocks, Frederick SeymourHoldsworth, HerbertThorne, William James
Cove, William G.Jenkins, Sir WilliamTinker, John Joseph
Cripps, Sir StaffordJohnstone, Harcourt (S. Shields)Wedgwood, Rt. Hon. Josiah
Curry, A. C.Jones, Henry Haydn (Merioneth)West, F. R.
Daggar, GeorgeJones, Morgan (Caerphilly)White, Henry Graham
Edwards, CharlesLawson, John JamesWilliams, David (Swansea, East)
Foot, Dingle (Dundee)Leonard, WilliamWilliams, Dr. John H. (Llanelly)
Gardner, Benjamin WalterLunn, WilliamWilliams. Thomas (York, Don Valley)
Greenwood, Rt. Hon. ArthurMaclean, Neil (Glasgow, Govan)Wilmot, John
Grenfell, David Rees (Glamorgan)Mainwaring. William Henry
Griffith, F. Kingsley (Middlesbro', W.)Mallalieu, Edward LancelotTELLERS FOR THE NOES.—Mr. G.
Macdonald and Mr. Groves.

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

5.46 p.m.

Photo of Mr Herbert Williams Mr Herbert Williams , Croydon South

I have just supported the Government, with very great pleasure, on the last Clause, which amended the Safeguarding of Industries Act, 1921. Therefore, I regret all the more that on Clause 5, which also amends the Safeguarding of Industries Act, I find myself in opposition. To-day I was rejoiced to read that, on the advice of His Majesty's Government in the Dominion of Canada, Dr. Banting, the discoverer of insulin, has been honoured with a knighthood. It seems to me a little in-appropriate that on the very day that that honour is announced we should be asked to pass a Clause which will have the effect of probably handing over to a foreign monopoly the manufacture of this important drug, if I may so describe it, discovered by this young and distinguished Canadian medical man.

May I remind the Committee, as I did on the previous Amendment, that the object of the Safeguarding of Industries Act was not protection in the ordinary sense but security in time of war; to make certain that there should always be available to our people certain commodities of which during the late War we experienced a great shortage. Here is a new commodity which did not exist, I think I am right in saying, when the Safeguarding of Industries Act was passed in 1921. Under Part I of that Act a duty of 33⅓ per cent. is imposed on foreign goods in certain categories, and one category was devoted to fine organic chemicals. The list of fine organic chemicals is very numerous and the number is constantly being added to. Accordingly, it was laid down that the Board of Trade should publish a list of the goods covered by that general description in the Schedule to the Safeguarding of Industries Act. The original list consisted of some 6,000 fine organic chemical products. As discoveries are made that list is augmented.

Under Section 10 of the Finance Act, 1926, which continued those duties for another 10 years, power was given to the Board of Trade, where necessary, to remove an article from the list if it appeared that it was not being produced either in this country or in any part of the British Empire. That was a wise provision because it prevented the continuation of the duty on an article where there was no competitive supply for the time being, which represented in those circumstances a burden without any advantage. There was a provision that as soon as the production began either here or in an Empire country the duty should come back into operation. Insulin did not exist in 1921, and therefore it did not appear in the first list. It did not appear in any list published by the Board of Trade, because they apparently took the view that it was not a fine organic chemical.

There was a provision in the Act of 1921 for the determination of doubtful cases, modified by Section 10 of the Finance Act, 1926, whereby such cases were referred to a panel of scientific advisers. Ultimately, in the autumn of last year, on the application of certain British manufacturers, the question whether insulin was or was not legally within the definition of a fine organic chemical was referred to a panel. The opposition did not come from any British interest but from the representative of a foreign institution, the Nordish Insulin Laboratorum, or their London agent. It was not that there was any British organisation against the inquiry or against the proposal that insulin should be classed as a fine organic chemical and become liable to a duty of 33⅓ per cent. As it had not been treated as such, it was paying the ordinary duty of 10 per cent. under the Import Duties Act.

The committee came to the conclusion that, legally, insulin was a fine organic chemical and, accordingly, the Board of Trade automatically made an order classing it on 14th December, 1933, as a fine organic chemical. In that matter the Board of Trade was not taking a political decision. They had no option. They were merely carrying out a statutory duty. If their view was that the duty was undesirable I suggest that an announcement to that effect ought to have been made at that time. However, the duty came into operation. For some months before the duty came into operation a very vigorous newspaper campaign was conducted against the duty and denouncing the Government for contemplating it. I was one of those who took some part in an endeavour outside this House to attack the Government. Once or twice on the public platform and several times in the public Press I contributed my views on the subject. I thought that the Press agitation was a rather disgraceful one, because its object was to try to terrify sick people. I do not think that anyone who took part in that agitation has anything of which to be proud. They led the people to believe that if a duty of 33⅓ per cent. came into operation the price of insulin would be raised.

Insulin was first manufactured in this country in 1923, and the initial price per 100 units, which is the way in which it is sold, was 25s. The price fell with very great rapidity, and before last autumn, or up to about 18 months ago, it had fallen to something like 2s. 8d. per 100 units. Up to last autumn two British firms were selling at such a price that the consumer could go to a chemist's shop and buy insulin at 2s. per 100 units. Another British firm sold insulin at 1s. 8d., while the Danish insulin, made by the institution which I have mentioned, was sold at 1s. 5d. So far as sufferers were concerned, if they were getting hospital treatment they got insulin free, and the hospitals were paying 1s. per 100 units. Persons insured under the National Health Insurance Act were getting insulin as a benefit under the Act and it cost them nothing. Therefore a very large proportion of the actual sufferers from diabetes were not primarily affected by the price. It is interesting to note that the price had fallen very heavily.

Photo of Sir Herbert Holdsworth Sir Herbert Holdsworth , Bradford South

Were the hospitals using British or foreign insulin?

Photo of Mr Herbert Williams Mr Herbert Williams , Croydon South

I understand—I speak without full knowledge—that in the main the hospitals were buying British insulin and doing their best to support manufacture in this country, because they realised how important it was that there should be an adequate supply produced in this country. The rise in duty from 10 per cent. to 33⅓ per cent. took place on 14th December last. Having taken an active part in the controversy, I occasionally took the opportunity when I was in a chemist's shop to ask if anything had happened with regard to insulin, and I discovered that there was no rise in price, thus bearing out the contention that I had put forward. Insulin is not the only product covered by the Safeguarding of Industries Act. There are a very large number of products bought by the public to-day at a much cheaper rate than in pre-War days when we were dependent solely on German supplies. Therefore, there was some analogy to work upon. The price at which insulin has been selling in this country is much lower than the price in the United States of America, where it is as high as 4s. 9d. There was no evidence, therefore, some weeks after the duty came into operation, that any sufferer in this country had been prejudiced.

There came a time, I forget the exact date, but it was towards the end of January or some time in February, when the two British firms who were selling at 2s. announced a reduction to 1s. 10d., and the other British firms who were selling at 1s. 8d. announced a reduction to 1s. 5d. Therefore, following the imposition of the duty, after about two months, these British firms, after considering the situation and realising that they had a degree of security and protection which they had not enjoyed before, were in a position further to lower the price. The lowest British price quoted by one firm was brought down to the price at which the Danes had been selling prior to the duty. Therefore, the view that I had expressed had been verified and the contention of the newspapers had been falsified. On 12th February of this year, for the first time, the matter was raised in the House on the Motion for the Adjournment by the hon. and gallant Member for Handsworth (Commander Locker-Lampson), who has always been an active Protectionist, but on this occasion was supporting what I might call the Free Trade side. The original decision of the Board of Trade, as I have said, was not a political decision but the carrying out of a statutory duty. When the matter was raised in Debate by my hon. and gallant Friend there was a good deal of inaccuracy in his speech. I do not know whether he is present; I should be sorry to criticise him in his absence. The response on behalf of the Government was made not by the Board of Trade, not by the Exchequer, but by the Parliamentary Secretary to the Ministry of Health who, in pre-crisis days was on the Free Trade side while I was on the Protectionist side. He delivered a most robust defence of the duty, and was criticised by some of his former colleagues for so doing. The hon. Member for South Bradford (Mr. Holdsworth) was one of his critics. May I quote what the Parliamentary Secretary said, because I agree with it? He said: In view of the fact that the Americans cannot produce it at anything like our price, and that it is cheaper here than anywhere except Scandinavia, I cannot see any reason for the apprehension of my hon. and gallant Friend. One can only hope "that the stabilisation of the duty will enable the home producers of insulin to do what other producers have done, and, by a reorganisation of production behind the duty and with an assured market, steadily reduce the price of the commodity. I can only express that hope, but I have the evidence of other commodities."—[OFFICIAL REPORT, 12th February, 1934; col. 1730, Vol. 285.] That was a strong statement. He was not sheltering himself behind a mere technicality. He was not saying that because this thing came into operation by a chance and because of the way in which the law had been prepared, he was going to repudiate it. Kb. He quite properly took up the view that even if this might have come into operation by chance, nevertheless it was a good thing, a justifiable thing and, speaking not as a private individual but as a Minister of the Crown responsible for the health of the people of this country, he defended the duty. That made it all the more surprising to me that when this Finance Bill was published, without any intimation, we suddenly discovered a Clause wiping out something which started on 14th December last, and was robustly defended by the Parliamentary Secretary to the Ministry of Health on 12th February. Yet without one word of warning, it is to be wiped out. That is not going to be of any good to sufferers from diabetes in this country.

The Danish institution, which at the moment is under-cutting every other producer in the world, is a rather unusual institution. It was created, apparently, by some act of the Danish Government, and is a semi-official institution. It does not trade with a view to making a profit in the general sense, and it has the supreme advantage that it pays no Income Tax. Apparently, it is staffed by people who are paid from other sources. This Danish institution, although not directly subsidised, appears to enjoy certain financial advantages which place it in a more favourable position than institutions in this country engaged in the production of insulin. In addition, insulin, although discovered by experiments on sheep, experiments dealing with the pancreas of the sheep, is to-day mainly made from the sweetbread of the pig, and on account of the large bacon industry in Denmark the Danes have at their disposal very large supplies of pig sweetbreads from which insulin is prepared. In this country we are hoping, and I think with some justification, to see a larger bacon production and, therefore, there will be available for our own people much larger supplies of the raw material from which insulin is prepared. The chances, therefore, are that circumstances in this country are going to be more favourable.

I am not hopeful of success in opposing this Clause. My right hon. Friend the Chancellor of the Exchequer will be able to call to his aid all the hon. Members opposite and also hon. Members on the second bench below the Gangway, where the Government will have almost super-national support. But that does not alter the fact that a Clause if this kind ought not to go through without debate or without an adequate statement on behalf of the Government as to why they have suddenly changed their policy. I spoke briefly on 12th February, after the Parliamentary Secretary to the Ministry of Health had spoken, and I found myself supporting the policy of the Government. That is not long ago. I am supporting the same policy now, but I find myself opposing the policy of the Government. I find it a little difficult to change my direction with such rapidity. This is what I am really concerned about. Let me assume that the Clause comes into operation and that the 33⅓ per cent. duty vanishes, as will also vanish the 10 per cent. duty, because insulin is placed on the Free List under the Import Duties Act. That will not debar the industry from making an application to the Import Duties Act. That will not debar the industry from making an application to the Import Duties Advisory Committee if they wish to do so in the future. Therefore, this matter may come before the House of Commons again. Personally, I hope they will be able to establish a case.

But let me assume that for political considerations—and we are dealing with political considerations—that the duty is not restored, and also that supplies from Denmark are cut off. The Safeguarding of Industries Act was passed on the regretable assumption that circumstances may conceivably arise in which we shall be involved in war. We hope they never will arise, but they might, and, therefore, what is going to be the position of the diabetic people in this country—100,000 of them—if the industry in this country has been destroyed and their supplies from abroad cut off? The spectacle of 100,000 people slowly dying from excess of sugar because the one thing to prevent it has been taken away from them IS a position which, I say, is too terrible to contemplate. But that is the position we must contemplate, and I ask the Parliamentary Secretary to the Ministry of Health and the Chancellor of the Exchequer to devote their minds to it. What security are we going to give to these people if a war should cut off those remedies essential for their existence? It is an essential element in the national defence. It may be that they are afraid there is going to be profiteering. I know that the Danish institution have made a further cut, a propaganda cut, in order to enlist support for the Clause, but if for some reasons which cannot be overcome the cost of production is higher in this country than in Denmark, instead of risking the possibility of destroying the industry it is surely wiser to make some other provision. It is not a difficult matter to do. It is horrible to contemplate an industry in this country being destroyed and 100,000 diabetic people, a number which, I regret to say, is increasing as a result of the changing habits of civilised people, being placed in a position of extreme peril. It is because I hold these views that I take up a position of opposition to the Clause.

6.7 p.m.

Photo of Sir Herbert Holdsworth Sir Herbert Holdsworth , Bradford South

I am not concerned at all with the technicalities of this matter, nor am I in any way convinced or moved by the last remarks of the hon. Member for South Croydon (Mr. H. Williams). I can see no reason why the English industry should not develop without this protection, or why it should not produce insulin at the same price as the Danish institution. I took part in the Debate of 12th February, when the Parliamentary Secretary to the Ministry of Health replied for the Government. When I saw this Clause in the Finance Bill I was agreeably surprised. I am not at all concerned as to why the Government have changed their mind; I am grateful that they have done so. This is not a subject which can be treated purely as a commercial proposition. The reason I took part in the Debate on lath February was because I had received letters from doctors and from people suffering from this dreadful disease, and I took the line then which I take now, that anything which will deprive a sufferer at the cheapest possible price, of something which has proved itself to be probably the only real cure and remedy, I must oppose with all my power.

Photo of Mr Herbert Williams Mr Herbert Williams , Croydon South

Will the hon. Member tell me whether any of his correspondents told him that they had had to pay more?

Photo of Sir Herbert Holdsworth Sir Herbert Holdsworth , Bradford South

They did; but I am coming to that point in a moment. The hon. Member is always saying that the price has not risen. What price? That is the whole question. Some English manufacturers were producing insulin at 1s. 8d. and some at 2s. I am not suggesting that there has been an increase in the price of 1s. 8d. or 2s., but I do suggest that the sufferer from diabetes, when the duty was on, had to pay 3d. more; those are the words of the hon. Member himself. He said that the price of Danish insulin was 1s. 5d. and that the English price was 1s. 8d. and 2s., and he went on to say that because of the duty no one had had to pay an increase of the English price.

Photo of Sir Herbert Holdsworth Sir Herbert Holdsworth , Bradford South

But the fact remains that the person who was purchasing Danish insulin at 1s. 5d. was thrown on to the English price of 1s. 8d. or 2s.

Photo of Mr Herbert Williams Mr Herbert Williams , Croydon South

The Danish product continued to be imported and those who wished to buy it were able to buy it still at 1s. 5d. No price of insulin was raised by anybody.

Photo of Sir Herbert Holdsworth Sir Herbert Holdsworth , Bradford South

The Danish people, in order to meet the duty, pulled down their price, but the purpose was to put it up to the English price. In that case, where is the protection to the English producer? The hon. Member cannot have it both ways. He then said that the English price came down to 1s. 5d. and also told us that the hospitals of this country were purchasing insulin at 1s. per 100 units of British make. If those who make it in England can supply hospitals at 1s. per 100 units why cannot they provide the individual sufferer with it at the same price? The hon. Member for South Croydon told us that there were 100,000 persons in this country suffering from this disease, and that the number was increasing. It is perfectly fair to say, therefore, that there is a likelihood of there being an increased demand for insulin which should enable it to be produced at a cheaper price. The hon. Member also said that with a development of the bacon industry the raw material for insulin would be much more available. Therefore, I can see no grounds whatever for a retention of the duty.

I know that in several cases the foreign producer has pulled down his price in order to meet the duty that has been levied, and very often the English producer has pulled down his price in order to meet the competition. What has always puzzled me is why the price could not have been pulled down before. The hon. Member for South Croydon said that he has stuck to his position. I agree, he has; but I want to compliment the Government sincerely and honestly on this Clause. I know that the hon. Member is a sincere believer in Protection, but I would suggest that there is something far beyond a question of Protection in this matter of insulin, and that this Committee should try to give sufferers from this dread disease every opportunity of procuring the remedy at the cheapest possible rate. I am prepared to wait for the day when this country does go to war. I believe we shall find a means of meeting the demands of these sufferers should such a calamity befall us, and if the British industry sets about its business in a proper way, I can see no reason why they should not produce insulin at the same price as the Danish institution.

6.15 p.m.

Photo of Mr John Jones Mr John Jones , West Ham Silvertown

Perhaps I have a right to say something on this question, because in 1920 I was sent to Montreal to represent the Trade Union Congress at a conference of the American Federation of Labour, and was taken ill on the voyage; and when I landed in Montreal I was sent to the Royal Victoria Hospital, and much to my surprise I was informed by the examining surgeon that I was a diabetic, suffering from sugar diabetes. Up to then I thought I had been suffering from other kinds of infirmities. I was in the hospital for seven weeks. I came home six stone lighter than when I went out to Canada, and the suit of clothes I had prepared fox the purpose of showing myself off in Canada—we all try to swank when we go abroad—would make two suits of clothes for me when I came back. My wife did not know me. She met me at the Liverpool landing stage. When I slapped her on the back and asked, "How are you, Kate?" she replied, "It is not you, Jack." I answered, "I hope it is." I was, of course, suffering from the first spasms of the disease. The doctors told me that the first thing I had to do was to get to London and to consult a specialist. I could not consult a specialist, because it takes £5 to open a specialist's mouth and about £10 to close it. Instead of doing that I consulted my union. It said: "We will see to you. Go up and see a specialist on this particular disease and we will do what we can to help you."

I went to see a doctor in Portland Place, and after examining everything he told me. "You will have to be very careful. You had better leave off this and leave off that, and live on this and live on that." I replied, "Doctor, I would sooner be dead than carry out your instructions." I broke every rule that he laid down for me. He gave me a long list of things that I ought to eat and ought not to eat, and what I ought to drink and ought not to drink, and I am still alive. Right opposite the hospital in Montreal where I had been were the two doctors who discovered the value of insulin. I ask hon. Members who oppose this Clause in the Bill, "Are you prepared to defend a system which would make it difficult for poor people to get a cure; do you want to compel the poor to pay a higher price for the insulin?" I have had this treatment, the injection, A patient has to go every day or twice or three times a week, to a doctor to get the injections. How can the ordinary worker pay a doctor twice or three times a week to have the insulin injected into his blood? Hon. Members have talked about buying insulin in bottles. The ordinary man might buy it in a bottle, but he would kill himself very likely before he had learned how to administer the stuff properly. It is not merely a question of buying the stuff, but the administration of it that is important.

Anything that stands in the way of sufferers getting the insulin or the treatment cheaply ought to be abolished. Consequently we are supporting the policy of the Government in this connection. We say that medicinal treatment, from wherever it comes, if it is good, should be welcomed. I do not care whether it is German medicine or any other kind of medicine. If it is good for the people, it ought to be allowed to come in free. I happen to be an illustration, though perhaps not a good one, of the result of treatment for the disease. The more sugar I have the better I like it, and I get it in various forms. I would sooner the with the medicine I like than with the medicine I do not like. I want to see everyone who wants this medicine able to get it. Diabetes to me has been a revelation. I never knew I was so healthy until I had it. I have lived 13 years longer than the doctor said I would live. They gave me six years to live and it is now nearly 14 years since I was first told that I was a victim of the disease. I am 14 years older and I think I am 14 years younger, and I am going to carry on.

6.23 p.m.

Photo of Dr Alfred Howitt Dr Alfred Howitt , Reading

I should be very sorry to see the insulin trade in this country deprived of the protection which it has enjoyed during the last few months. The hon. Member for South Croydon (Mr. H. Williams) has stated clearly the history of what has been happening, but there are one or two things from the medical point of view that I would like to bring forward. I do not know whether Members of the Committee are aware of it, but this country to-day produces a finer and purer insulin than any other country in the world. Our rivals are the Danes. It was our chemists here who generously taught the Danes how to manufacture insulin as we know it. Little did they think that the tables would be turned on them, as they will be turned if this protection is removed. If people say that insulin will be cheaper if the protection is removed, they are wrong. While protection has been operating the insulin has steadily become cheaper and cheaper.

We run a great risk to-day because Denmark is able to produce insulin more cheaply than we are, partly because of the subsidised nature of the manufacture, partly because of the ease with which the pancreas can be obtained, and partly because of its cheapness in Denmark. It has been suggested that if there were a very big pig production here we would perhaps be able to get the pancreas as cheaply as the Danes, but it takes a long time to cure a habit in the people, and as our people have long been in the habit of eating Danish bacon it will take a long time to turn to the home-produced article instead. While we are getting rid of that bad habit of eating Danish bacon we shall be getting into another bad habit, and that will be the habit of instilling Danish insulin into our people. Once we get the habit of using the Danish variety of insulin it will be extremely hard to get rid of the habit. In the hospital with which I have connection no insulin except British insulin is used. That is not entirely for patriotic reasons. It is not because the doctors insist on using British insulin, but "because they say it is the best. That is a very interesting fact. Other kinds have been tried, and of course the hospital authorities wish to use the cheapest insulin they can get as long as the doctors are satisfied that it is as good, but none is as good as the British.

Since the Finance Bill has been published there has been great activity amongst the Danish emissaries in this country. The danger we run is that it would pay Denmark to sell her insulin at a loss over a period if the Danes could succeed in closing down our chemical works here. In this country there are three firms which produce insulin. I am informed by the chemists here that insulin is sold to-day at 9½d. and that they cannot produce it at a less price. Since we had the benefit of this protection not only have we got a market here, but there has been an increase in our exports. British insulin is becoming world famous, but if we have to produce it at a loss and the industry is not subsidised, it is obvious that the manufacturers will have to shut down. There are two difficulties ahead. If the manufacturers have to shut down there will be, first, the difficulty of again training people to turn out this very complicated product. There will be, secondly, the great difficulty of changing bad habits, for once the hospitals of this country have got used to Danish insulin it will be very difficult to get them to change to the insulin produced in this country. We have been told about the working man having to pay for insulin. Is that true? Does not the workman who is insured get his insulin free through the panel system of the country? [HON. MEMBERS: "Not all workers!"] Not all workers, but the majority. The case which has been brought up was the case of the man who was working.

Photo of Mr David Grenfell Mr David Grenfell , Gower

The hon. Member must remember the very large numbers of unemployed workmen who, because they have been unemployed so long, do not get medical treatment.

Photo of Dr Alfred Howitt Dr Alfred Howitt , Reading

They get treatment from the hospitals, I presume. It may seem inconsistent to put on a duty, then take it off and then put it on again, but there is sometimes virtue in a certain amount of inconsistency. In any case, if the Chancellor of the Exchequer cannot see his way to allow this protection to remain, I hope he will appreciate the great part which the chemists of this country have played in the past, and will now encourage them to apply, before it is too late, to the Import Duties Advisory Committee to see that this trade, which is so essential to us, shall be preserved. I am fearful that if there is no protection there will be an enormous increase in the amount of Danish insulin used in this country. As I have said, it is not, in my opinion, as good as the British insulin. I also think, that if we can produce the best in the world at the same price as the foreign product English people would prefer to use the British article.

6.31 p.m.

Photo of Mr Michael Beaumont Mr Michael Beaumont , Aylesbury

I hope that in defence of this Clause, the Government will be able to present a better case than that which was given to the House by the hon. Member for South Bradford (Mr. Holdsworth), whose defence consisted of a repetition of unfounded and unjustified assertions. I deplore any tendency to introduce in this Debate questions of Free Trade or Protection as principles. I think the object of all Members is the same, namely, to secure to those who suffer from this disease the best and cheapest possible supply of this vital drug. The point on which we differ from all those who have spoken in favour of the Clause so far, and on which we seek enlightenment and explanation from the Government is that we do not believe that that object can be achieved by the removal of the duty. I do not wish to cover again the ground already so ably traversed by my hon. Friend the Member for South Croydon (Mr. H. Williams). He has given the Committee a history of this insulin trade and of insulin prices under the operation of the duty. The fact remains that, so far from the price having risen as was supposed, it has actually fallen, there has always been a supply of foreign insulin, at the same price, for those who choose to buy it and there is no reason whatever why any person in this country, under the operation of the duty, should have to pay one farthing more for insulin.

I wish in this connection to advert to one argument and one question submitted by the hon. Member for South Bradford. He said, and we agree that insulin was sold to the consumer at 1s. 5d., but we are told that hospitals were purchasing it at one shilling and the hon. Member asked why could it not be sold everywhere at the same price? The answer is that one price was the wholesale price and the other was the retail price and, as the hon. Member knows, between those two, there is always a great gulf fixed. The hon. Member also put forward this peculiar query. Why was it, he asked, that when there was a duty and when foreign manufacturers reduced their prices, the British manufacturers frequently followed suit? Why should they not, he asked, give the lead? This is the answer and herein, in our view, lies the virtue of the duty. They can only do it in so far as they have a guaranteed market. We contend that the value of a duty is that it gives manufacturers in this country a secured market which would encourage them to go on manufacturing the drug, and they could still sell it at a price, not higher than that of the foreign manufacturers and of a quality superior to that of the foreign manufactured article.

Photo of Sir Herbert Holdsworth Sir Herbert Holdsworth , Bradford South

If the hon. Member's assertion is correct, that the English product can be sold at the same price as the foreign product and of a quality superior to the foreign product, why should the English manufacturer have any fear as to his market? I have always found in my business that if I could sell a thing as cheaply as my competitors and of a superior quality, there was never any question of making a sale.

Photo of Mr Michael Beaumont Mr Michael Beaumont , Aylesbury

The hon. Member has failed to follow the point of my argument. The British manufacturer, we contend, can only produce the article as cheaply as the foreigner if he has a guaranteed market secured to him by the duty, and once the guaranteed market is removed, his price has to go up because he is not certain of his turnover. [HON. MEMBERS: "Oh!"] That is our contention, and, in spite of the "noises off" indulged in by hon. Members opposite, I venture to suggest that that is the fact. One other point to which I would allude concerns the question of the desirability and, as we submit, the necessity of having a working insulin industry in this country. Both the hon. Member for South Bradford and my hon. Friend the Member for South Croydon in their remarks, only contemplated a shortage of insulin in the case of war. I suggest that the thing goes much deeper than that, I hope, remote eventuality, and that it is not sound policy to have a commodity of this sort in the hands of a foreign monopoly. Suppose that the Danish producers by selling below cost price were able to capture the English market and make it their monopoly, they would be able to raise the price on the English consumers to their heart's content.

Further, it is undesirable that a commodity of this sort should in any circumstances be used as a bargaining weapon in negotiations between nations, and there is the possibility, if we allowed this commodity to become a foreign monopoly, that it might be so used. I have sufficient confidence in His Majesty's Government to hope that all these points have been taken into consideration by them, that they will be able to assure us that if this Clause is passed the British industry will not be endangered and that they will be able to give us some greater reason for that belief than the somewhat vague aspirations of the hon. Member for South Bradford. I hope very much that they will bear in mind the facts which have been mentioned in this Debate and that they will not, as a result of an ill-informed and not too scrupulous newspaper campaign, be led into leaving the sick—for whom the opponents of the Clause feel just as much as hon. Members opposite—at the mercy of foreign monopolies who might, I fear, be less scrupulous in their treatment of those in need of the drug than our own people.

6.40 p.m.

Photo of Mr Neville Chamberlain Mr Neville Chamberlain , Birmingham, Edgbaston

It is evident from the speeches in this discussion that it is extremely difficult to separate this matter from the general question of Protection and Free Trade. I agree with my hon. Friend the Member for Aylesbury (Mr. M. Beaumont) that it is desirable to do so, although I am not certain that he was completely successful in his endeavour to carry out his own maxim. It is important, however, as this Clause has been debated, that I should make clear what its history has been. My hon. Friend the Member for South Croydon (Mr. H. Williams), who is always, I am glad to say, anxious to support the policy of the Government, has not on this occasion been quite certain of what that policy is, and it would be very awkward if in our endeavours to support the policy of the Government we were to support something which was not their policy at all, owing to a mistaken impression. If the history of this question be examined, it will be seen that the imposition of the 33⅓ per cent. duty upon imported insulin under the Safeguarding of Industries Act was a kind of accident. It was never intended by the Government at all. Insulin was not picked out by the Government as an article of such importance in war-time that it must be safeguarded.

Photo of Mr Neville Chamberlain Mr Neville Chamberlain , Birmingham, Edgbaston

It did not exist then, but it existed at the time when the list was published by the Board of Trade of articles which they regarded as coming within the designation of fine chemicals. What happened was that that list of articles comprised within the term "fine chemicals" was published and the Board of Trade did not include insulin. Their omission to do so was challenged by the Association of British Chemical Manufacturers. The Board of Trade took up the challenge. They opposed the inclusion of insulin in the list and, therefore, they opposed the imposition of the duty of 33⅓ per cent. upon imported insulin. Under the procedure which has been described, the matter was taken before a tribunal, and the tribunal decided that insulin must be included in the list of fine chemicals. But what was the purpose of the Association of British Chemical Manufacturers in taking this question of insulin to the tribunal? It was not that they were particularly interested in insulin itself. It was that they were anxious to establish what they considered to be an important principle to them, namely, that certain biological and glandular products should be defined as "fine chemicals." Having obtained the establishment of that principle, which they did by the decision of the tribunal, they were not particularly interested in the question of insulin which is not, from their point of view, of very great importance.

That being so, it will be seen that the imposition of the duty which is to be repealed by this Clause, was not, on the one hand, part of a deliberate policy of the Government to include insulin among the products which came under the Safeguarding of Industries Act, nor, on the other hand, was it the result of examination by the Import Duties Advisory Committee as to whether insulin was a product which ought to be protected in the interests of the manufacturers in this country. It can only, I think, be described as a sort of accident which arose out of the attempt by the British Association of Chemical Manufacturers to establish their principle. Having received the decision of the tribunal, the Board of Trade had no option in the matter. They were obliged at once to impose a duty of 33⅓ per cent., and automatically then insulin ceased to be liable to the original ad valorem duty of 10 per cent., which had been placed upon it before the safeguarding duty was imposed.

I do not want to suggest that this Clause is introduced into the Bill because of any improper behaviour on the part of the chemical manufacturers of this country. There is no suggestion in any quarter, I think, that they have actually exploited the situation or, indeed, that the consumer has not in fact had the benefit of successive reductions in price, in spite of the duty. That is true, and I think it is very much to the credit, if I may venture to say so, of the British manufacturers that not only have they continuously reduced the price of insulin, but that they have also, as my hon. Friend the Member for Reading (Dr. Howitt) said, succeeded in producing insulin of a quality which has established a special reputation, not only in this country, but in other countries as well, and which incidentally has enabled them to get a price for that specially pure article.

Why then do we repeal this duty? I must admit that I am personally responsible for the initiative in this matter. I have had representations made to me on the subject from the country, from various quarters, to the effect that diabetics felt that the price of insulin was higher than it otherwise would have been in consequence of this duty, which, as I have said, had been accidentally imposed upon it. I made inquiries when these representations were made to me, because I felt that the case of insulin and the case of the diabetics was quite different from the ordinary case of the person suffering from a disease for which there is a remedy and which can be cured and after cure requires no further supply of that remedy. As everybody knows, the case of diabetes is a case of a deficiency which has to be supplied, and supplied continuously throughout life, by this particular drug, which is the discovery of the celebrated doctor who has been honoured in the list published to-day.

I think one hon. Member said there were 100,000 of these sufferers. My information is that there are very considerably more than that, but it does not matter whether the number be 100,000, 200,000, or 300,000. At any rate, to these people insulin is a matter of life and death, and even if they thought, mistakenly if you like, that they were in a position where they had to pay more than they ought to pay, or more than it was necessary that they should pay, for this necessity to them by reason of a duty put on by the Government, I think they would have a just cause for complaint. As a matter of fact, since the announcement that the duty was to be repealed, there has been a further reduction in the price of insulin, and that leads directly to the benefit of the diabetics.

What then is the reason why we should keep the duty on? I have shown that it is not because we consider this is a matter of policy. The only reason that I can think of is the reason which I understand is adduced by those who have been criticising this Clause, namely, that once you take away the protection which is now given to the British manufacturer, he will lose his home market, he will thereupon gradually be driven out of the business, we shall be left at the mercy of the foreign manufacturer or importer, and then the price may go up, and the diabetics' last state may be worse than the first.

Photo of Mr Neville Chamberlain Mr Neville Chamberlain , Birmingham, Edgbaston

I appear to have correctly described the argument. Let us assume that that is true. The first effect is the reduction in the price, the next effect, according to the argument, is the gradual disappearance of the British manufacturer, and the third and last is the putting up of the price of the drug.

Photo of Mr Herbert Williams Mr Herbert Williams , Croydon South

And the cessation of supplies during war.

Photo of Mr Neville Chamberlain Mr Neville Chamberlain , Birmingham, Edgbaston

I will not discuss war time just yet. I think the other is perhaps the more general argument. Observe what the effect of the repeal of the duty will be. It immediately frees the manufacturer and allows him to make application to the Import Duties Advisory Committee for the imposition of a new duty, not necessarily the present duty, but an ad valorem duty and an additional duty if the Import Duties Advisory Committee think that that is desirable. Then there will be an inquiry into the facts of the case, it will be investigated as to whether it really is the case that the interests of the diabetics themselves are threatened, and if the Import Duties Advisory Committee came to the conclusion that they were, I imagine that they would make a recommendation accordingly. Certainly I may say at once that the Government would not contemplate with equanimity a situation such as that which has been mentioned by my hon. Friend, and if the recommendation were made to them, supported by the evidence, that the process was actually taking place, I do not imagine that the Treasury would have any hesitation in making an Order which would put on the appropriate rate of duty.

I say this in conclusion, first of all, that the actual duty which is now in existence has not been put on in consequence either of an examination into the case or because it was a deliberate part of the policy of the Government, secondly, that other things being equal, I think one should try to remove from the minds of diabetics the fear that they are being made to pay more than they need do for what is an essential of life to them, and in the third place the position is now left, if the Clause is passed, so that it is always possible for the manufacturers to make an application to the Import Duties Advisory Committee, and the procedure will be gone through with which the Committee is already so familiar.

6.53 p.m.

Photo of Mr David Grenfell Mr David Grenfell , Gower

On this side we wish to tender our appreciation of the Government's action in this matter, and we do so unreservedly. The hon. Member for South Croydon (Mr. H. Williams) was, quite right in his anticipation that we should be congratulating the Minister on this Clause. We should have done so readily, without hearing the speech of the Chancellor of the Exchequer, and we find no occasion to dissent from a single Word that he has said, and we are very anxious indeed that the Committee should wholeheartedly approve of the Clause. The hon. Member for South Croydon is too technical, as he has been to-night, and in taking this opportunity to review the history of this matter, he has given the Committee information no doubt, but he has removed himself and all those who agree with him away from the realities of this very urgent question. There are Members of this House who are themselves victims of diabetes, and who could say from their own experience what a great blessing this great discovery has been to them. We hold the view very definitely that the lowering of the price of insulin has conferred more benefits, medically, upon the masses of the people of this country than any other thing that has happened in recent years. The figures have been given. There are anything from 200,000 to 300,000 victims of this disease, rich and poor, all manner of men, all equal in suffering and all equal before the onslaught of this disease.

Particularly is this concession to be welcomed because it brings equality of opportunity for relief. The cheaper the price of insulin, the more widespread are its advantages and the greater the universal advantage which is derived from it. We welcome this concession, and we hope that it is an instalment of larger measures which are to follow, by which pain and suffering will be relieved as freely and as promptly as medical science permits. Circumstances, position, means should not stand in this matter. It is a question of humanity, not of the trade interests of which we have heard tonight. We deplore very much having heard to-night the consideration of trade interests in regard to this vital matter.

Photo of Mr Michael Beaumont Mr Michael Beaumont , Aylesbury

From whom have we heard of trade interests?

Photo of Mr David Grenfell Mr David Grenfell , Gower

I have heard three speeches where trade interests have been stressed.

Photo of Mr David Grenfell Mr David Grenfell , Gower

That is the construction that I put upon them. Other hon. Members can put their own construction upon them. The right hon. Gentleman the Chancellor of the Exchequer said that this was not a drug in the ordinary way, and certainly not an object of profit making. One hon. Gentleman said that this was more a food, a daily food necessity for the people of this country, and we regret very much to hear that 200,000 or 300,000 people who are victims of diabetes and who are in daily need of this necessity should be deprived of it because of any artificial interference with the cheapening tendencies which we welcome so much in these days. This Committee does not know what insulin costs. The hon. Member for Reading (Dr. Howitt) said that it is the hospitals which provide insulin. If a hospital does provide it in some cases, it does not in all cases. I know a very large number of people who inject two or three times a day into their own blood-stream from 50 or 60 to 100 units a day, an enormous quantity.

The hon. Member for South Croydon, who does not want to listen to anything except his own voice, must remember—he himself gave figures and said that 100 units cost 1s. 8d. or 2s.—that to working people in this country who have to use 50, 60, and up to a daily dosage of 100 units, that is an expense of 1s. 6d. to 2s. a day in extreme cases, and there are very large numbers of working people who have to provide for an expense of 5s., 6s. and Vs. a week in this way. It is a matter of vital importance to these people. There are people who have written to me, whom I have not known, but whose acquaintance I have made because I asked questions in this House of the Minister of Health some months ago on this very important matter, and, having received that correspondence, I feel it my duty to stand up here for the most generous provision of insulin possible. I welcome this Clause with its very valuable concession. It is not a thing written in large figures, but it is a thing written large in terms of relief of pain and suffering. For that reason, we welcome the concession and thank the tight hon. Gentleman for it.

6.59 p.m.

Photo of Mr Michael Beaumont Mr Michael Beaumont , Aylesbury

Before we pass from this subject, I wish to protest most emphatically against the absolutely unfounded suggestion of the hon. Member for Gower (Mr. D. Grenfell) that this matter is affected by trade interests. As far as I am concerned, I have no connection with that or any other trade. I may be liable to error, as the hon. Member opposite is, but my view is advanced from the same motives as his own, because I believe it is in the interests of the diabetics. I may be wrong, and I may be right, but I emphatically protest at any suggestion that anything other than the pure interests of the diabetics were underlying my intervention.

7.0 p.m.

Photo of Sir Stafford Cripps Sir Stafford Cripps , Bristol East

I think the hon. Gentleman probably misunderstood the way in which my hon. Friend used the term "trade interest." The point is that the hon. Gentleman and his friends consider that a necessary product of this kind should not be profit-earning through a trade interest. We believe that articles as essential as insulin should be produced by the State, as apparently the Danes are producing it through some semi-State institution which does not run on a profit-earning basis, and which is, therefore, able to provide it at a cheaper rate. There is no need why, if people need it, they should not all have a cheap supply of it, but that cannot be done by trade interests; it can only be done under a proper system of Socialist distribution. [Laughter.] Hon. Members may laugh, but the hon. Member for Aylesbury (Mr. M. Beaumont) is nodding his head at me. May I congratulate the Chancellor of the Exchequer on what was the most magnificent Free Trade speech I have ever heard, showing that essential food commodities must not be taxed on coming into the country.

Photo of Mr Reginald Banks Mr Reginald Banks , Swindon

Does it not follow that anybody who does not agree with that theory of economics is to be accused of defending trade interests?

Photo of Sir Stafford Cripps Sir Stafford Cripps , Bristol East

It is not a question of defending trade interests. It is a question of approaching, the problem from a point of view; that is, the policy of making a profit out of supply and demand.

7.3 p.m.

Photo of Mr Herbert Williams Mr Herbert Williams , Croydon South

I think the hon. and learned Member was a little unwise to answer somebody else's question for him and then to proceed to explain the interpretation he put upon it. The hon. Member for Gower (Mr. D. Grenfell) put on trade interests an ordinary interpretation and not the extraordinary one expounded by the hon. and learned Member. The Chancellor of the Exchequer does not think that this is necessarily a closed matter. He has indicated that he will not resist a reimposition of the duty, a very important declaration. Obviously, the position is a changeable one. The Chancellor of the Exchequer said quite clearly that, if the Import Duties Advisory Committee, after taking all factors into account as they would, made a recommendation, the Treasury would not hesitate to make an Order. Reimposition of the duty is not ruled out. Whether it will come about depends on circumstances. That takes away from us all necessity of registering our protest by voting in the Lobby. I am not one who hesitates to support my views with my vote when necessary. It does seem to me, however, a clumsy way to do this. If the Government did not desire the report of the inquiry that has been made, if this interest had made an application under the Import Duties Act to which they were entitled, we could have avoided the report, putting the duty on, taking it off, and putting it on again.

8.24 p.m.

Photo of Sir Percy Harris Sir Percy Harris , Bethnal Green South West

I beg to move, in page 6, line 41, to leave out "specified in the Second Schedule to this Act."

I hope I shall not be considered ungrateful in moving this Amendment. I appreciate that the Government are conscious of the serious position of the shipbuilding trade. There are certain industries, like that with which the Minister for Mines is so ably associated, which have been going through a very-bad and distressing time, but it is not unfair to say that shipbuilding, and British shipbuilding in particular, has felt perhaps as much as any industry the full blast of the world economic depression. Many of the shipbuilding areas are almost wiped out. It is only by the most careful co-ordination of interests, the cutting down of some yards, and the amalgamation and merging of various companies, that the industry is kept solvent. I realise that no doubt it is due to the influence of the President of the Board of Trade, for no one is better able to speak for the shipbuilding industry. In the various tariff duties special consideration has been given to the ship-building industry. Under the original Act of 1932 shipyards had certain privileges in regard to import duties which did not apply to other industries. The right hon. Gentleman, no doubt as a concession, is arranging that the importation of goods of any class or description specified in the Second Schedule shall be exempted if the Commissioners are satisfied that the goods are being imported for use in the construction or repair of the boilers or propelling machinery of ships.

I turn to the Schedule and find a comparatively small list of goods, and I suggest that, as long as the Commissioners have discretion, it does not seem wise to limit it to these particular articles. If it is practicable in the construction of boilers and propelling machinery for ships to exempt articles from duty, the list should be as complete as possible, and should include everything the Commissioners find they can provide. That certainly applies in the original Act. If the hon. Gentleman will turn to Section 11 he will see that there is no limitation of the character now suggested. In that case it is limited to goods consigned to shipbuilding yards. I particularly press the point now, because when I turn to the trade returns for April, 1934, I find that the figures are most alarming and certainly indicate the necessity for drastic action if the shipbuilding industry is to be saved and put on its legs again. I find that in the first four months of 1931, which was not a good year, the exports coming under the category of ships or vessels amounted to £1,800,000. In 1932 it had gone down to £1,276,000 in the first four months, and for the same period this year it had gone down to the small figure of £602,000. The volume of business has been decreased owing to quotas, restrictions, tariffs, and all the unnatural hindrances to trade. The carrying trade of the world has been reduced, and naturally owners of ships are not inclined to give orders for the production of new ships. Therefore, with the severe competition for the limited tonnage required, prices are an essential factor. We are grateful to the right hon. Gentleman for his small concession, and I suggest that he should make the concession complete so as to include all articles required for the construction of ships.

8.30 p.m.

Photo of Mr Edward Mallalieu Mr Edward Mallalieu , Colne Valley

I do not say it is a coincidence that at this moment there should be a case for the Government giving further subsidies to shipping. Although there has been a tremendous world cause for the present condition of shipbuilding and the shipping industry, our own Government have very materially contributed to that position by having cut down the external trade of this country, not only by their tariff measures, but also by their sugar-beet industry proposals.

Photo of Lieut-General Edward Fitzroy Lieut-General Edward Fitzroy , Daventry

I think that the hon. Member had better confine himself to the Amendment.

Photo of Mr Edward Mallalieu Mr Edward Mallalieu , Colne Valley

I am giving the reason for this Amendment being exceedingly apt in; view of what had gone before. The Amendment brought forward by the hon. Baronet the Member for South-West Bethnal Green (Sir P. Harris) is singularly apt at the moment when the shipbuilding industry is in such a dreadful condition. Section 11 of the Import Duties Act, 1932, as he said, gave the Tariff Commissioners power—it was merely permissive—to exempt imports going to registered shipyards. The proposal in the Finance Bill of this year is to make it obligatory to exempt from duty certain classes of goods used in shipbuilding. There does not seem to be any sufficient reason for leaving the provision where it is now proposed to leave it. What makes the Government propose that the goods enumerated in the Second Schedule of the Bill only should be exempted The Committee will be indebted to whatever Member of the Government replies, if he will say why these goods only are included in the Schedule, and why all goods necessary for the building of ships are not included. I do not profess to know all the details of the matter, but no doubt the Parliamentary Secretary to the Board of Trade does, and will be able to give a useful explanation. In the meantime I suggest that the words should be left out, and that the provision which is applied to certain articles only in the Schedule should be applied to all articles necessary for the building of ships.

8.33 p.m.

Photo of Mr Edward Burgin Mr Edward Burgin , Luton

When countries build tariff systems round them there is, as a rule, some special care taken with regard to items necessary in the building and construction of ships, and if those who are interested will look at the tariff walls of the United States of America, of Germany and of other countries they will find that when a tariff wall is put round a country, very tender regard is paid to items necessary for the construction of a ship. Consequently, when the Import Duties Act, 1932, was brought before this House, Section 11 was inserted with a view to favouring the very old established British superiority in shipbuilding, and to see that articles essential for shipbuilding consigned to registered shipyards should be able to come in free from the duties which Parliament was asked to impose. It was thought that the task could be achieved by registering shipyards, that is to say, by registering the premises. It is very difficult when an article is brought into this country in one form and undergoes many processes, and is subsequently found in a ship, to know whether it is an article imported for the purpose of shipbuilding or one which will find itself ultimately in a ship. The way to assist the Commissioners of Customs and Excise who have to operate the Act when a particular consignment arrived, is to say there shall be shipbuilding yards which shall be registered, and goods consigned direct to those yards shall be exempted by the commissioners. In some shipbuilding yards not only do they build a ship and make its hull, but they also build the propelling machinery. In those cases where the propelling machinery works happens geographically to be within the curtelage of the shipyard, it followed that everything required by the makers of the ship-propelling machinery came in dutyfree. If, however, entirely as a matter of geography, instead of having the marine engine works within the curtelage of the registered shipyards they were across the street, then the goods could not be imported duty-free, because they were not consigned to a registered shipbuilding yard. Therefore, the position of the marine engine works differed according to the amount of land available on the sides of the rivers and estuaries where shipbuilding is carried on.

We have had representations made to the Government constantly about the inequality that was produced in regard to people handling substantially the same thing, because of the mere accident whether or not the ship could come alongside the yard. It was the test of a registered shipbuilding yard that you should be able to bring your boat alongside the actual yard and that it could either be built on, in, or attached to the actual shipbuilding yard. On some rivers, the Tyne for instance, there are a number of deep water wharves where you can bring a vessel alongside, but on the Clyde, curiously enough, for the greater part the marine engine works are not possessed of quays actually alongside the river and consequently you cannot bring your ship alongside the marine engine works on the Clyde. If there is a centre where marine engine works have secured very great prominence it is on the Clyde, yet many of the great firms of marine engine builders have been unable to secure the consignment of goods duty-free under Section 11 to their marine engine works.

Let the Committee understand that there is a new ship being constructed and tenders are put in for the propelling machinery. A foreign firm could send a complete engine unit consigned direct to the shipbuilding yard, and it would come in duty free, but a British marine engineering firm building a competing engine and wishing to tender for the supply of the propelling machinery for that ship and wanting to import certain parts to make up its whole engine was unable to get those parts without paying the duty. This proposal in the Finance Bill is, therefore, nothing more than a proposal to endeavour as far as possible to overcome an administrative difficulty in the working of Section 11 of the Import Duties Act, 1932. The new Clause endeavours to put right the grievance of the marine engine builder by saying that those parts which the marine engine builder may want to import duty free shall, under the circumstances set out in this Clause, be allowed to come in free. It is not a general enabling power. It is not a reversal of policy. It is an administrative attempt to overcome a difficulty which has been found to exist in the past, and it is thought, with the co-operation of the Commissioners of Customs and Excise, to be a way to achieve the desired result.

The hon. Member for the Colne Valley (Mr. Mallalieu), half jestingly and half seriously asked whether the six items specified in the Second Schedule, to which this Clause refers were complete, whether they were all necessary and whether they were all the types of articles which the marine engine builder requires. The answer is in the affirmative. This is a Clause drafted in co-operation with the best advice we could procure from those engaged in the industry which it is desired, with common accord, to help, namely, that there shall not be a positive premium on introducing a whole engine complete from abroad into a shipyard as distinct from introducing a part by a British marine engine maker to be built into an engine here. The Clause is designed to secure that, and it is not an attempt at the general extension which the hon. Member for Bethnal Green, South-West (Sir P. Harris) is seeking to give to it, by suggesting that once the Import Duties Advisory Committee have made a report anything in an engine can be allowed to come in free. That is a much wider proposal than the Government have in mind. In the first place, you have a registered shipyard which includes a marine engine works within the yard itself, and this Clause is to level up the case of those marine engine builders whose premises are not geographically within a registered shipyard. That is the Clause to which the Government adhere.

8.42 p.m.

Photo of Sir Herbert Holdsworth Sir Herbert Holdsworth , Bradford South

While thanking the hon. Member for his explanation, I might say that what we were afraid of was that this proposal was a limitation of the scope of Section 11 and not an extension of it. We do not mind how much it is extended but we are afraid that there is some limitation here. Under Section 11 the powers were permissive. The Import Duties Advisory Committee could impose certain conditions. I do not, say that I do not accept the explanation of the Minister, but when the Import Duties Act was being discussed in the House there was an outcry against the importation of certain materials for shipbuilding. Will the hon. Member say that there is no question of limiting the purpose intended by Section 11 of the Import Duties Act, that the items in the Second Schedule include everything necessary for the building of ships and that they shall be free from duty? If he would give me that assurance, I shall be much obliged.

8.43 p.m.

Photo of Mr Edward Burgin Mr Edward Burgin , Luton

I can give the hon. Member an immediate assurance that the whole object of the Clause is to extend and not to limit the operation of Section 11. Let me again put the position to the Committee. So long as you have premises which are a registered shipyard anything consigned to them for incorporation in the ship is duty free, under Section 11. It is only in a comparatively small number of cases that the marine engine building works are actually within the registered shipyard, so that Section 11 does not apply at present to the great majority of marine engine builders' works. It is not possible to register all marine engine works as shipyards, because in addition to making marine engines they often make other things. You could not have, little works all over the country in a great number of inland places being registered as shipyards. For example, the British Thomson-Houston Company, of Rugby, supply a great deal of material used in ships, but it could not be registered as a shipyard. It would be something ironical, when Great Britain is an island, that we should have registered shipyards in inland places. We could not do that, but we can go to the marine engine builders and say: "Make a list of the things you rightly want to import." We are only dealing with things which they cannot get here, which they must import from abroad in order to put them into their engines, which are subsequently to be put inside the ship. We say: "What are you likely to import which would be under a duty unless we give you special exemption." This list of articles required for shipbuilding purposes has been made up with the co-operation of the interests concerned, and while one can never hope to please everybody with any formula, you can be tolerably sure, when you have investigated a matter in the way this has been investigated, that the ground is substantially covered. The Clause is designed to remove an anomaly which it has been impossible to explain—namely, why shipbuilding yards in certain cases are registered shipbuilding yards and others making marine engines elsewhere because they are not registered do not come under the provisions of Section 11. The grievance will be met and the importation of the specified parts will be free of duty if they are for marine engines.

8.46 p.m.

Photo of Sir Percy Harris Sir Percy Harris , Bethnal Green South West

We have had a most remarkable statement from the Parliamentary Secretary and an illustration as to the extraordinary difficulties of administering the import Duties Act and the injuiry which is being done to the shipbuilding trade. The hon. Member has admitted that the Clyde area, one of the worst hit areas in the country, has been seriously hampered by the difficulty of importing essential articles in the construction and repair of boilers and propelling machinery. We are asking that the principle in Section (11) of the original Act should apply in this case. It would be more reasonable, in the case of goods imported for the manufacture of boilers and propelling machinery of ships, that where the Commissioners are satisfied that these goods should be exempt, the exemption should not be limited to a few articles. That is not an unreasonable request. If they are able to satisfy the conditions that the goods are really required for the purpose. I suggest that they should without exception be exempt. I hope the Government will be able to grant this small concession. We are supposed to be discussing a Finance Bill, but so far we have had no intervention by the Financial Secretary. A few well chosen words would be welcome. The Chancellor of the Exchequer, except in the case of insulin, has been sitting in sphinx-like silence. We are really discussing a Tariff Bill, finance has been pushed into the background. We are debating how we can placate this industry and that by a concession here and there, or by a lowering of the duty.

Photo of Lieut-General Edward Fitzroy Lieut-General Edward Fitzroy , Daventry

The hon. Member is getting very wide of the Clause under discussion.

Photo of Sir Percy Harris Sir Percy Harris , Bethnal Green South West

That is all I want to say. It would be a justification of his distinguished occupation and responsibility of guiding a Finance Bill through the Committee if the Financial Secretary could make some concession to this distressed industry, which is crying out for help, and which has been suffering from a clumsy wording of the Governments' own Act.

8.50 p.m.

Photo of Mr Morgan Jones Mr Morgan Jones , Caerphilly

I confess that the last observations of the Parliamentary Secretary have come as a revelation to me. It may be that I am disclosing a colossal ignorance, but I acknowledge that I do not know much about shipbuilding. At the same time, I have always understood that the steel trades of this country claim that they are efficient and up to date, and able to meet the needs of the country, but I gather from the Parliamentary Secretary that there are certain types of work, sections of completed articles, which they are not able to provide.

Photo of Mr Edward Burgin Mr Edward Burgin , Luton

Not necessarily steel.

Photo of Mr Morgan Jones Mr Morgan Jones , Caerphilly

The materials are referred to in the Second Schedule. The question which strikes me is this. Now that we are about to have tariffs imposed are we still to be in the position of having to admit that our steel trade will yet be so inefficient as to be unable to provide essential parts in the building of a ship? The whole argument has been, protect us from unfair competition from outside and we will show you how competent we are. Yet, here we are, in spite of the fact that we are to consider measures for protecting this industry, being told in advance that whatever we may do in that direction there must be free trade in regard to certain specified products of the steel and allied trades. I did not expect to hear so bland and open a confession that this wonderful country of ours, which is so advanced in the matter of steel products, has still to admit that other parts of the world are more advanced in respect of certain articles.

8.50 p.m.

Photo of Mr John Wilmot Mr John Wilmot , Fulham East

I listened with great interest to the statement made by the Parliamentary Secretary with regard to the position of registered shipyards. I have very little knowledge of the shipbuilding industry but I should like to know whether it is the fact that within this tariff-ridden country of ours there are little areas which are a kind of free trade state, and that these free trade states are registered shipyards. May I ask whether it is true that registered shipyards within the meaning of the Act enjoy a kind of extra territorial right to import free of duty any kind of goods which are required in the construction of ships?

Photo of Mr Edward Burgin Mr Edward Burgin , Luton

The Section speaks for itself. Section (11) of the Import Duties Act, 1932, permits materials which are imported into registered shipyards for the purpose of shipbuilding to be imported free of duty. The whole point is that administratively the control by the Customs is by consignment direct to a yard which has produced a certificate of registration. In other words, it is to premises.

Photo of Mr John Wilmot Mr John Wilmot , Fulham East

I am obliged for the explanation, but it is a surprise to me, and I have no doubt to other hon. Members, to learn that any kind of material required in the building of ships may be imported into a registered shipbuilding yard free of duty. In these circumstances it seems rather remarkable that the Second Schedule to which this Clause refers should be such a short one. One would have expected that ash trays and smoking room curtain materials, oak planks and sail cloth, would have been among the materials used in the construction of ships, and that the special extra territorial privilege which attaches to a registered shipbuilding yard would have been extended to the unfortunate people who are manufacturing these other materials used in shipbuilding but whose works or factories happen to be situated at some place geographically remote from a registered shipbuilding yard.

It would seem that if this Clause is to become law the Government will be faced with a new procession of importunate claimants up another set of backstairs, and these will be persons claiming to be manufacturers of materials used in the legitimate building of ships, claiming that they are at an unfair disadvantage as regards the foreigner, because the foreigner can bring his material and dump it straight into a Free Trade, specially privileged, registered shipbuilding yard, while they are endeavouring to manufacture their material in some place where these special privileges do not apply. I would draw attention to the extraordinary sets of circumstances that are growing up as a result of our experience of tariff conditions. It seems very extraordinary that, having imposed a tariff ostensibly for the reason that the industry established in this country is capable of producing all that is required and at a price which is fair to the consumer, it is then necessary to issue wholesale licences in all sorts of directions to get behind those very provisions.

8.57 p.m.

Photo of Mr Alan Chorlton Mr Alan Chorlton , Manchester Platting

Really the last speaker is getting so wide of the mark that as one who knows a little about engine building I would like to bring him back to the Amendment. The provision in the Bill refers only to engine works not within the shipyard. This is a right and proper action to take to correct something that had not been foreseen. An engine works which is going to supply engines to a ship and does not happen to be within the shipyard is to be on all fours with the engine works that is within the shipyard. Why the hon. Member should put all that long string of words together about something which was really introduced to help his own people in the early stage of the steel industry, I cannot think. I hope that the simple explanation which I understand was previously given by the Parliamentary Secretary to the Board of Trade will be a little clearer even than what I have said.

8.59 p.m.

Photo of Mr Aaron Curry Mr Aaron Curry , Bishop Auckland

I want to ask a question of some importance before we leave this matter. I understand that the purpose of the Government is to extend to those industries that supply engines to ships the privilege of free admission which is already given to shipyards which are engaged in the construction of ships. There are defined in the second Schedule to the Bill those articles which are to be admitted free, no matter to which part of the country they go. The purpose of the Amendment is to assist the Government to obtain what they desire, which is that the construction of ships in our yards shall not be enhanced in cost by the imposition of a tariff upon any article which is essential to the building. The case which I have in mind is that of insulation. The people who are engaged in the work of insulation of pipes and other things upon ships, I understand, have to import certain portions of the material used in the process of manufacture, and at the present time they have to pay a duty, and yet when they are engaged on the insulation of a ship that duty is in their costs. I would like the Parliamentary Secretary to tell us whether this particular case has been thought about by the Government, and if so why it is not included in the Schedule.

Indeed, the more we think of this matter, once it is admitted that in order to keep our place in the shipping industry of the world we must have a free market in which to purchase materials—once that is admitted by the Government, there is no halting place between this and Free Trade in the building of ships. The purpose of the Amendment if to extend what the last speaker seemed to desire, namely, that the anomaly should be done away with and that things required in the construction of ships, not the accessories in. the furnishing of ships, must be allowed into this country free. The Government admit that, and for appearance sake they seem to endeavour to indicate that the whole of these articles can be included in any Schedule. I submit that they cannot be, and I ask the Parliamentary Secretary to say specifically whether the case of insulation material has been considered, and whether he cannot extend the Schedule to include such material.

9.2 p.m.

Photo of Mr Joseph Batey Mr Joseph Batey , Spennymoor

I have listened to all the discussion, but I was not able to understand the explanation of the Parliamentary Secretary. The hon. Member for Platting (Mr. Chorlton) caused me to rise because he corrected my hon. Friend the Member for East Fulham (Mr. Wilmot), and said that what was meant by this Clause was to allow engine works to supply these materials. Having looked at the Schedule I do not see that the hon. Member for Platting had made the matter clearer. I can, perhaps, understand some of the items mentioned, but I cannot understand No. 3. It allows to come in, duty free, iron and steel plates not less than one-eighth of an inch nor more than two inches in thickness. I cannot imagine any engine works supplying those.

Photo of Mr Joseph Batey Mr Joseph Batey , Spennymoor

This is far wider than the boilers. These are iron and steel plates used in the shipyards, which means any iron and steel plate used in the building of the ships, that are allowed in duty free. Nor was the matter made clear by the Parliamentary Secretary, who said that the proposal was to bring in marine engine works that are not within a registered shipyard. It seems to me that No. 3 ought not to have been included here. It is simply used to bring in marine engine works. There have been more than 12 months' experience of the working of these exemptions. It certainly does not seem to have helped the shipbuilding industry very much. On the Tyne shipbuilding has not revived or become prosperous because of these exemptions. After all, is the exemption of these articles worth while?

9.5 p.m.

Photo of Mr Edward Burgin Mr Edward Burgin , Luton

In reply to the hon. Member for Spennymoor (Mr. Batey) the experience of the operation of Section 11 of the Import Duties Act, 1932, has been this—that goods required for the building, repairing or refitting of ships have been imported into registered shipyards for the express purpose of avoiding duty. Those builders who happen to have engine-works within their registered shipbuilding yards, have imported their engines, sometimes complete, from abroad because, by so doing, they have avoided paying duty on the whole or any part. Of course no exemption can overcome depression in trade. The hon. Member expressed astonishment that the shipbuilding industry on the Tyne had not yet revived as fully as it might have. This section has made greater the possibility of British shipbuilding yards competing with abroad, but the experience of the working of the section has been that all these marine engine builders who, for reasons laid down by the Commissioners of Customs and Excise, were not able to procure registration under Section 11 have felt an acute sense of grievance because they have found themselves in competition with completed foreign engines consigned direct to shipbuilding yards. It is to remedy that state of affairs that this new provision is introduced.

The hon. Member for Bishop Auckland (Mr. Curry) asked had the Government considered the case of insulating apparatus and its parts. The answer is "yes" and hon. Members will find that this Schedule can, with the approval of the Import Duties Advisory Committee and the Treasury, be extended. It is a question of making out a claim. Subsection (2) of Clause 9 provides that the Treasury may, on the recommendation of the Import Duties Advisory Committee and after consultation with the Board of Trade, add to or withdraw from the Schedule—in other words vary the Schedule.

Photo of Mr Edward Burgin Mr Edward Burgin , Luton

Because the whole point is to endeavour to deal with the grievance to which I have referred. Having attempted to legislate for shipbuilding in Section 11 of the Act of 1932 and having found the difficulty in practice regarding marine engine works which are not in shipbuilding yards, this is a Clause designed to meet that difficulty. It is a specific Clause to meet a particular difficulty and if it were made general the result would be that it would cease to have the very effect for which it is designed.

9.9 p.m.

Photo of Mr Charles Brown Mr Charles Brown , Mansfield

The longer this Debate continues the more interesting it becomes. I do not know that the successive speeches of the Parliamentary Secretary throw further light on the subject, but they certainly provide interesting revelations of a change of attitude on the part of a person who once held views entirely different from those which he now expounds at that Box. In his last statement he has made a very interesting admission. He has laid down the dictum that tariffs are not going to cure depression of trade. That is a very interesting statement coming from the Government Front Bench. As far as we on these benches are concerned, we duly note that statement and on appropriate occasions and in appropriate places we shall make full use of it.

Mr. CAPQRN:

In answer to the hon. Member for Mansfield (Mr. C. Brown) may I point out that the Parliamentary Secretary did not say anything of the kind——

Photo of Lieut-General Edward Fitzroy Lieut-General Edward Fitzroy , Daventry

The hon. Member is raising a matter which was not improperly referred to as the reference has been replied to; but it is a matter which I cannot allow to be debated on this Amendment.

Question put, "That the words proposed to be left out stand part of the Clause."

The Committee divided: Ayes, 217: Noes, 53.

Division No. 265.]AYES.[9.12 p.m.
Acland-Troyte, Lieut.-ColonelFuller, Captain A. G.Morris-Jones, Dr. J. H. (Denbigh)
Adams, Samuel Vyvyan T. (Leeds, W.)Ganzonl, Sir JohnMorrison, G. A. (Scottish Univer'ties)
Agnew, Lieut.-Com. P. G.Gillett, Sir George MastermanMoss, Captain H. J.
Albery, Irving JamesGledhill, GilbertMunro, Patrick
Allen, Sir J. Sandeman (Liverp'l, W.)Gluckstein, Louis HallsNation, Brigadler-Goneral J. J. H.
Allen, William (Stoke-on-Trent)Gower, Sir RobertNicholson, Godfrey (Morpeth)
Anstruther-Gray, W. J.Greaves-Lord, Sir WalterNormand, Rt. Hon. Wilfrid
Apsley, LordGreene, William P. C.Peake, Captain Osbert
Atholl, Duchess ofGrimston, R. V.Pearson. William G.
Bailey, Eric Alfred GeorgeGritten, W. G. HowardPenny, Sir George
Balllie, Sir Adrian W. M.Gunston, Captain D. W.Percy, Lord Eustace
Baldwin, Rt. Hon. StanleyHales, Harold K.Petherick, M.
Baldwin-Webb. Colonel J.Hammersley, Samuel S.Pownall, Sir Assheton
Balniel, LordHanbury, CecilRadford, E. A.
Banks, Sir Reginald MitchellHannon. Patrick Joseph HenryRaikes, Henry V. A. M.
Barclay-Harvey, C. M.Harbord, ArthurRamsay. T. B. W. (Western Isles)
Barrie, Sir Charles CouparHaslam, Henry (Horncastle)Ramsden, Sir Eugene
Beauchamp, Sir Brograve CampbellHeadlam, Lieut.-Col. Cuthbert M.Rankin, Robert
Beaumont, Hon. R. E. B. (Portsm'th, C)Hellgers, Captain F. F. A.Ray, Sir William
Bllndell, JamesHenderson, Sir Vivian L. (Chelmsford)Reed, Arthur C. (Exeter)
Borodate, ViscountHepworth, JosephReid, James S. C. (Stirling)
Boulton, W. W.Hills, Major Rt. Hon. John WallerRemer, John R.
Braithwalte, J. G. (Hillsborough)Hore-Bellsha, LeslieRoberts, Sir Samuel (Ecclesall)
Broadbent, Colonel JohnHornby, FrankRopner, Colonel L.
Brocklebank, C. E. R.Horobin, Ian M.Rosbotham. Sir Thomas
Brown, Ernest (Leith)Horsbrugh, FlorenceRoss, Ronald D.
Brown, Brig.-Gen. H. C. (Berks., Newb'y)Howard, Tom ForrestRoss Taylor, Walter (Woodbridge)
Browne, Captain A. C.Howitt, Dr. Alfred B.Ruggles-Brise, Colonel E. A.
Buchan-Hepburn, p. G. T.Hume, Sir George HopwoodRunge, Noran Cecil
Burgin, Dr. Edward LeslieHunter, Dr. Joseph (Dumfries)Russell, Hamer Field (Shef'ld, B'tslde)
Burnett, John GeorgeHurst, Sir Gerald B.Russell, R. J. (Eddisbury)
Cadogan, Hon. EdwardJackson, Sir Henry (Wandsworth, C.)Rutherford, John (Edmonton)
Campbell, Sir Edward Taswell (Brmly)Jeeson, Major Thomas E.Rutherford, Sir John Hugo (Liverp'l)
Campbell-Johnston, MalcolmJohnston, J. W. (Clackmannan)Salmon, Sir Isidore
Caporn, Arthur CecilJones, Sir G. W. H. (Stoke New'gton)Salt, Edward W.
Carver, Major William H.Jones, Lewis (Swansea, West)Sandeman, Sir A. N. Stewart
Chamberlain, Rt. Hon. N. (Edgbaston)Kimball, LawrenceSanderson, Sir Frank Barnard
Chapman, Col. R. (Houghton-le-Spring)Knight. HolfordSelley, Harry R.
Chorlton, Alan Ernest LeofricKnox, Sir AlfredShaw, Helen B. (Lanark, Bothwell)
Clarry, Reginald GeorgeLamb, Sir Joseph QuintenShaw, Captain William T. (Forfar)
Clayton, Sir ChristopherLaw, Sir AlfredShepperson, Sir Ernest W.
Cobb, Sir CyrilLaw, Richard K. (Hull, S. W.)Simmonds, Oliver Edwin
Colfox. Major William PhilipLeckle, J. A.Smith, Louis W. (Sheffield. Hallam)
Conant. R. J. E.Leech. Dr. J. W.Smith, Sir R. W. (Ab'd'n. & K'dine, C.)
Cook, Thomas A.Lees-Jones, JohnSmithers, Sir Waldron
Cooke, DouglasLevy, ThomasSomervell, Sir Donald
Courtauld, Major John SewellLockwood, John C. (Hackney, C.)Somerville, Annesley A. (Windsor)
Courthope, Colonel Sir George L.Lockwood, Capt. J. H. (Shipley)Somerville, D. G. (Willesden, East)
Craven-Ellis, WilliamLoder, Captain J. de VereSoper. Richard
Crooke, J. SmedleyLoftus, Plerce C.Sotheran-Estcourt, Captain T. E.
Croom-Johnson, R. P.Mabane, WilliamSouthby, Commander Archibald R. J.
Cruddas, Lieut.-Colonel BernardMcCorquodale, M. S.Spencer, Captain Richard A.
Davies, Maj. Geo. F. (Somerset, Yeovil)McEwen, Captain J. H. F.Spender-Clay, Rt. Hon. Herbert H.
Dawson, Sir PhilipMcKie, John HamiltonSpens, William Patrick
Duncan, James A. L. (Kensington, N.)Maclay, Hon. Joseph PatonStanley, Hon. O. F. G. (Westmorland)
Dunglass, LordMcLean, Major Sir Alan.Stewart, J. H. (Fife. E.)
Elliston, Captain George SampsonMcLean, Dr. W. H. (Tradeston)Stourton, Hon. John J.
Elmley, ViscountMacquisten, Frederick AlexanderStrauss, Edward A.
Emmott, Charles E. G. C.Manningham-Bulter, Lt.-Col. Sir M.Sueter, Rear-Admiral Sir Murray F.
Emrys- Evans, P. V.Margeseon, Capt. Rt. Hon. H. D. R.Sugden, Sir Wilfrid Hart
Entwistle, Cyril FullardMarsden, Commander ArthurSummersby, Charles H.
Erskine-Bolst, Capt. C. C. (Blk'pool)Martin, Thomas B.Sutcliffe, Harold
Essenhigh, Reginald ClareMayhew, Lieut.-Colonel JohnTate, Mavis Constance
Everard, W. LindsayMitchell, Harold P. (Br'tf'd & Chisw'k)Thomas. James P. L. (Hereford)
Fleming, Edward LascellesMoniell, Rt. Hon. Sir B. EyresThompson, Sir Luke
Fremantle, Sir FrancisMorgan, Robert H.Thomson. Sir Frederick Charles
Thorp, Linton TheodoreWard, Irene Mary Bewick (Wallsend)Wilson, G. H. A. (Cambridge U.)
Todd, A. L. S. (Kingtwinford)Warrender, Sir Victor A. G.Wise, Alfred R.
Touche, Gordon CosmoWedderburn, Henry James Scrymgeoar.Worthington, Dr. John V.
Train, JohnWells, Sydney Richard
Tufnell, Lieut.-Commander R. L.Weymouth, ViscountTELLERS FOR THE AYES—
Turton, Robert HughWhyte, Jardine BellCaptain Austin Hudson and Sir
Wallace, John (Dunfermline)Williams, Herbert G. (Croydon, S.)Walter Womersley.
Ward, Lt.-Col. Sir A. L. (Hull)Wilson, Clyde T. (West Toxteth)
NOES.
Acland, Rt. Hon. Sir Francis DykeGriffiths, T. (Monmouth, Pontypool)Milner, Major James
Adams, D. M. (Poplar, South)Groves, Thomas E.Owen, Major Goronwy
Banfield, John WilliamGrundy, Thomas W.Rathbone, Eleanor
Batey, JosephHall, George H. (Merthyr Tydvil)Rothschild, James A. de
Bernays, RobertHarris, Sir PercySinclair, Maj. Rt. Hn. Sir A. (C'thness)
Brown. C. W. E. (Notts., Mansfield)Holdsworth, HerbertSmith, Tom (Normanton)
Cape, ThomasJenkins, Sir WilliamThorne, William James
Cocks, Frederick SeymourJohnstone, Harcourt (S. Shields)Tinker, John Joseph
Cove, William G.Jones, Henry Haydn (Merioneth)Wedgwood, Rt. Hon. Joslah
Cripps, Sir StaffordJones, Morgan (Caerphilly)West, F. R.
Curry, A. C.Lawson, John JamesWhite, Henry Graham
Daggar, GeorgeLeonard, WilliamWilliams, David (Swansea, East)
Edwards, CharlesLunn, WilliamWilliams, Dr. John H. (Llanelly)
Foot, Dingle (Dundee)Macdonald. Gordon (Ince)Williams. Thomas (York, Don Valley)
Gardner, Benjamin WalterMcEntee, Valentine L.Wilmot, John
Greenwood, Rt. Hon. ArthurMaclean, Nell (Glasgow, Govan)
Grenfell. David Rees (Glamorgan)Mallalleu, Edward LancelotTELLERS FOR THE NOES.—
Griffith, F. Kingsley (Middlesbro', W.)Mander, Geoffrey le M.Mr. Walter Rea and Sir Robert
Griffiths, George A. (Yorks, W. Riding)Mason, David M. (Edinburgh, E.)Hamilton.

Motion made, and Question, "That the Clause stand part of the Bill," put, and agreed to.