Clause 2. — (Power of Board of Trade in certain circumstances to restrict imports from a foreign country.)

Orders of the Day — Debts Clearing Offices and Import Restrictions Reprisals Bill. – in the House of Commons on 26th June 1934.

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7.47 p.m.

Photo of Mr Aled Roberts Mr Aled Roberts , Wrexham

I beg to move, in page 4, line 4, to leave out "or are about to be."

This is a very curious phrase to appear in a Bill of this kind. The discussions have so far been of the greatest precision. We have dealt with abstruse points and each point has been cleared up or not, as the case may be. When we come to this Clause—which the Chancellor of the Exchequer tells us is not necessary in connection with the emergency and might have been left over and gone into more carefully—we find these very vague words, which give the Board of Trade power to impose restrictions if it appears to them that a foreign country has imposed restrictions or is about to impose restrictions. How will the Board of Trade have any idea that a foreign country is about to impose restrictions? They may have some idea when they see an intimation that restrictions are to be put on, but how can they know in advance that they are about to be put on? This Clause seems to give the Board of Trade the power to issue these retaliatory restrictions for almost any purpose they may think fit. If these words remain in the Bill the Board of Trade would be able to put on a quota against any foreign importation at any time, and if they were challenged they could say: "It appeared to us that this foreign country was about to put on quantitative restrictions." Whether they do put on those restrictions or not would not matter, because all that the Board of Trade would have to satisfy itself about was that the foreign country appeared to be about to put on restrictions. I should be glad if the Government would give us some indication of the circumstances they have in mind when asking for powers of this kind. In a Clause which is going to change the whole character of the present commercial relationships with other countries it would be desirable to have the provision worded in the most precise and most understandable way and not to leave a loophole of this kind, which does not make for that precision which one would expect in a Bill of this character.

7.50 p.m.

Photo of Mr John Colville Mr John Colville , Midlothian and Peeblesshire Northern

We propose to accept the Amendment, but not on the grounds on which the hon. Member has moved it, that there is any vagueness in the phrase. It is perfectly easy to tell when such action is to be taken by a foreign country, inasmuch as legislation in many cases would be introduced for the purpose. We intend to rely on the knowledge that will exist in foreign countries, after the passage of this Bill, that we have in fact power of complete reciprocal action if we feel that discrimination is being made against our imports. We do not wish to do more than take the necessary safeguards.

Photo of Mr Herbert Samuel Mr Herbert Samuel , Darwen

I thank the hon. and gallant Member for his kindness in accep ting the Amendment. It will be a great improvement to the Clause. The Clause was undoubtedly vague and gave powers which were wider than the occasion really required.

Amendment agreed to.

7.51 p.m.

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

I beg to move, in page 4, line 16, at the end, to insert: (2) "Any Order made under this Section shall have effect only so long as such quantitative restrictions remain in force in the country to which the Order relates. The Minister for Overseas Trade has shown himself so reasonable and so desirous that the Bill should be strictly limited that I have every hope he will accept this Amendment. I am particularly glad that the Minister now in charge of the Bill is the Minister for Overseas Trade, because he has been working hard from the time that he began his office stimulating trade for the mutual advantage of all the countries concerned. There has been no Minister more diligent in seeking that desirable end. He has been going to and fro throughout the world trying to break down barriers, to remove causes of suspicion and to bring our country in amicable agreement with other nations. For that reason, I think he will accept this Amendment.

The Clause allows this country to retain the power, in case of necessity, of retaliating when quotas are put on our goods, thereby limiting the opportunities of our manufactures to find markets. The form of retaliation is to impose a quota on the offending country. It ought to be made, quite clear, however, that as soon as this weapon has achieved "its purpose and succeeded in wiping out the offending quota on our goods which has interfered with our trade the quota on the foreign goods should be removed. Suppose Germany reverted to the undesirable practice of fixing a quota for British coal and we in return fixed a quota on, say, German glassware or German toys. The whole purpose of this policy is to stop the interference with our trade. What we want to be sure about is that as soon as Germany has taken off the restrictions, say, on our coal, automatically the powers given under this Bill will no longer be used against any particular article of that country.

We have had some experience in Ireland. It was made quite clear the other day in regard to the restrictions on the importation of Irish cattle that the Government are not prepared to remove them, even if the Free State no longer fails in her obligation to meet her interest of the Land Bonds, because in the meantime we have created a vested interest in this country. Strong vested interests have been created here who have gained benefit from the restrictions on the importation of Irish cattle. In the present case, once we have put a quota on German imports we may find that pressure will be exerted upon the Government from interests in this country to retain the quota on German imports. We want to narrow the purpose of the Bill, and the Chancellor of the Exchequer has accepted that principle. The operation of the Bill has been limited to a period of two years. It has become not a permanent Measure but a temporary Measure for a particular purpose. Is it not reasonable when the Government are asking for these new powers to ensure that when they have gained their end they should not take advantage of the Act for other purposes, in order to protect interests that have been sheltered. The Amendment would not limit the negotiating powers of the Government, and I hope it will be accepted.

7.57 p.m.

Photo of Mr John Colville Mr John Colville , Midlothian and Peeblesshire Northern

The hon. Baronet must not be surprised if I say at once that we cannot accept the Amendment, and for a reason which I can give to the Committee in a very few words. It would be the normal policy of the Government to retain the retaliatory prohibition or restriction on imports only so long as the occasion for the retaliation exists. Immediately the reason for the retaliation was gone we should wish to remove the restriction. What the hon. Baronet is asking us to do is to insert an Amendment which would set up an extraordinary procedure, for it would make the operation of Board of Trade Orders dependent on the action of some foreign country. Our administrative machinery in this country would have to function automatically on account of the action taken in some foreign country. If this Amendment were passed and became law, I could conceive that British officials would be liable to legal proceedings and penalties for restricting imports on goods when an action had taken place in a foreign country of which they might not be aware. The Committee will appreciate that somebody has to decide whether the discrimination against our goods and the cause for our complaint have been effectively removed, and that decision must be made by His Majesty's Government. Therefore, I put it that we are not unreasonable in adhering to the view that in point of fact the proper procedure will be for the Board of Trade, as soon as the Government are satisfied that the reason for the action under this Clause no longer exists, to revoke the original order by a subsequent order under Clause 3, Sub-section (2). That would be laid before Parliament, it would become immediately operative, and the retaliation would be at an end. The procedure suggested in the Amendment would not be practicable.

8.1 p.m.

Photo of Mr Herbert Samuel Mr Herbert Samuel , Darwen

The answer of the hon. and gallant Member is no doubt good in point of form, but not in point of substance. I see no reply to his contention that the effect of this Amendment would be that British subjects would be bound by action taken in some foreign country, but it is no answer to the contention of substance of my hon. Friend who moved the Amendment. The Minister says quite truly that the proper procedure would be that, if and when the cause of the action had been removed, the order could be revoked by a subsequent order of the Board of Trade. That clearly would be the right procedure, and I suggest that it should be inserted in the Bill. This part of the Bill is called "Import Restrictions Reprisals," but there is nothing in the Bill which makes it clear that when the cause for reprisals has been removed the action taken will terminate.

What we consider might be the case is that some Government which believed in quotas for their own sake, finding them in force under the terms of this Bill, would not agree to the action taken against the foreign country being repealed if the foreign country were prepared to discontinue the action which had been the original cause of offence. If you had a provision in the Bill that as soon as the cause had been removed the action taken here would be at an end, our Government would be bound, when the foreign Government gave us redress, to repeal its action; but unless there is some such provision in the Bill that would not be obligatory, and it would be left to the choice of the Government of the day whether or not to remove the quotas. The right course would be in another place to put in a provision precisely in the terms which have been suggested to the Committee, namely, that if and when the cause of the action had been removed, the Board of Trade can by subsequent order revoke the action which it had taken. I press that on the Government. The Government have been conciliatory and they have made great progress with the Bill. They have accepted an Amendment and limited the operation of the Bill to two years. They have endeavoured to meet the wishes of the Committee, and I suggest that the same spirit should be shown in this case. On that understanding, I think my hon. Friend might be willing to withdraw the Amendment.

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

On the understanding that the Minister will do his best to meet our objections by inserting the necessary words in another place, I am willing to withdraw the Amendment.

8.6 p.m.

Photo of Mr John Colville Mr John Colville , Midlothian and Peeblesshire Northern

I cannot give the undertaking asked for. It should be quite clear by this time that the purpose of this Clause is simply to meet discriminatory action with an effective method. With regard to the procedure under the Import Duties Act, where we have powers, in the event of discriminatory taxation being imposed, to apply taxation here, it is left to the Government to remove that discriminatory taxation as soon as the evil has been removed, bet me give a practical instance. In a very few days time, I am glad to say, we are to end the dispute with France on the subject of discriminatory taxation and quotas, and we shall not retain our discriminatory taxes for a day longer than is necessary. I hope that the right hon. Member for Darwen (Sir H. Samuel) and his friends will see that the intention of the Government is not in any way to set up a network of permanent quotas, but only to deal with the question of discrimination against our trade.

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

I have great confidence in the Secretary of the Overseas Trade Department, and I therefore beg to ask leave to withdraw the Amendment.

Amendment, by leave, withdrawn.

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

8.8 p.m.

Photo of Mr Clement Attlee Mr Clement Attlee , Stepney Limehouse

We oppose the Clause. We consider that the Government have made out no case whatever for including it in the Bill. This Measure has been brought before us as essentially an emergency Measure. It arises out of a definite dispute with one particular country Germany, and the proposals in the Bill for dealing with the German situation are contained in Clause 1. The Chancellor told us quite frankly that Clause 2 has nothing to do with the emergency, or with Germany at all. He comes before the House with the excuse that some traders have indicated to him that it would be rather useful to have this power, and so he thinks he will include this Clause. It is an extraordinarily wide-reaching power. It is brought before us under conditions which do not permit proper consideration. The Bill has to be got through in two days. The Report stage, Third Beading and Committee are alll taken on the same day. It is obvious that in those circumstances no substantial Amendment could be allowed.

It is against all precedents for a Bill other than an emergency Bill to be passed under such conditions. The Chancellor takes advantage of this quarrel with Germany to tack on to his proposal for dealing with that situation, a power which he thinks he would like to have The House is so accustomed now to giving all kinds of extreme powers to the Government that the mass of Members do not take any particular notice. The kind of language that the Chancellor used in introducing his Bill was rather noticeable. If it had been a previous Chancellor, the right hon. Member for Epping (Mr. Churchill), one would have understood it, because he always uses the language of war. But the present Chancellor is a man of peace. He told us, however, that he would like to be armed with a useful weapon. That indicates very clearly the attitude of the Government towards international trade. International trade is not on the lines of an exchange of commodities between different countries; it is a battlefield, and the Chancellor is waging a war, and he now thinks he has got a particular weapon. Whether it is an offensive or defensive weapon I do not know. It never matters very much.

All of a sudden the Government have discovered that there is a very dangerous thing called a quota, and they want to be able to meet it. I do not know what they have been doing during the last two years, whether they have been shunning the company of the Minister of Agriculture, who has lived and talked of the quota day after day. In fact the quota is that Minister's favourite instrument or weapon. A sudden suggestion is made, "Oh, we never thought about the quota before, and now we find it is going to be used or may be used against us." It is noticeable that this Clause arms the Chancellor against some danger that has not yet occurred. It is quite in the best line of militarism. We are always told that all armaments are purely defensive. If you ask a defence Minister against what country he is arming he can never tell you. Here we have exactly the same thing with regard to trade. We have no suggestion that there is any particular country aimed at. In fact the Chancellor said expressly that it was not aimed at Germany or any other country. It is just a power that he would like to have.

Increasingly we are having this habit of the present Government, of Bills being brought down, unconsidered, all of a sudden, and containing a number of provisions for some of which there may be a case of urgency which could be put, and others which are just something which the Government think they would like to have. It is a very dangerous precedent. If anyone on the Labour or Independent Labour Party benches suggested doing any such thing he would be denounced from one end of the country to the other as a destroyer of the rights of Parliament and everything else. It is against all the traditions of this House to combine in one Bill two Clauses so utterly distinct as these, one framed for one purpose and the other for a wholly different purpose. We think, too, that the Clause is far too wide. As far as I can see it enables the Board of Trade to act on the complaint of any particular vested interest. It is on applications from vested interests that this Government mainly acts. Question Time in the House is taken up a good deal by vested interests. They are not confined to this country.

If someone is interested in oranges from Palestine or tin from Nigeria or anything of that kind, and they think they would rather like to be free of competition—and people in this House who believe in the competitive system are always endeavouring to free themselves from competition—they now have a convenient method of doing it. They can represent their hardships to the Board of Trade, which can approve an Order, and they are rid of their competition. They can find somewhere that a particular country in the British Empire is suffering from some restriction imposed by a foreign country, and if they can establish that they have a good case for retaliation. They will be really in the position of common informers, but they will not go round to the Board of Trade for the benefit of the country. Every trader will be on the look out to see if he can find a quota which affects some part of the British Empire, and he can then go round to the Board of Trade and say, "What about that restriction we wanted to get through? It is true it was turned down by the Import Duties Advisory Committee, and therefore we cannot get it that way; but here is a chance to work it in under this Bill as a quid pro quo for a gross injustice that is being done to Tristan da Cunha."

Under this Bill we shall get what the Lord President of the Council once said we should get, and what was given as a reason why tariffs were put in the hands of a committee of three, namely, every possibility of every kind of wangling by vested interests. Above all, these vested interests will be in the happy position of being able to say that they are vindicating the honour of the British Empire and, of course, will have nothing to say about the consequences to themselves. This is a vicious Clause and the method by which it has been introduced—under cover of a disagreement with Germany requiring urgent action—is against all the traditions of this House.

8.18 p.m.

Photo of Mr David Mason Mr David Mason , Edinburgh East

I rise to support the rejection of this Clause. It is so wide and all-embracing that it has been im- possible in the time at our disposal to have Amendments to it thoroughly discussed. Let us examine one or two points in the Clause. I observe that the President of the Board of Trade is present; his name is on the back of the Bill. Under this Clause, he will have power in certain circumstances to make orders prohibiting importation of goods from a. foreign country. It is true that the Chancellor of the Exchequer has courteously met us on these benches by limiting the duration of this Clause to two years, but a great deal of damage to trade may be done in that time. This Clause gives immense powers. Sub-section (2) says that: The countries to which this section applies are the United Kingdom, the Channel Islands, Newfoundland, the Colonies, the British Protectorates and Protected States, and any territory in respect of which a mandate on behalf of the League of Nations has been accepted by His Majesty and is being exercised by His Majesty's Government in the United Kingdom. The Clause may affect 29 countries. We are being asked in one day to pass a Measure for a specific purpose and which contains a Clause which is not necessary even to meet the crisis. It is being rushed through under cover of a crisis in another direction which one admits exists. To ask us to subscribe to a Clause of this character is not respectful to the House of Commons or to any section of it. Whatever our views may be, we are entitled to express them and to communicate with our constituents and various bodies like Chambers of Commerce in order to get their ideas of the particular commodities and trades which may be affected by this Clause. In the last Sub-section very arbitrary power is given to the President of the Board of Trade. Anything authorised under this Act to be done by the Board of Trade may be done by the President of the Board, or in his absence by a Secretary of State. That is a blank cheque to the whole Government. If the President of the Board of Trade should be absent, any Secretary of State can apparently carry on anything authorised in the Bill. That is really defying the rights of this House. Although we are in a minority, we are entitled to have some deference paid to our opinions, and we shall get as large a Division as we can to protest against this Clause being carried.

8.23 p.m.

Photo of Captain Richard Evans Captain Richard Evans , Carmarthen

I also oppose the retention of this Clause. I think that the Committee has demonstrated to-day its support of any action that may be necessary on the specific issue with Germany, and it is not quite playing the game with the House or with the country that a proposal so far-reaching, so full of potentialities, should be introduced under the cloak of an emergency. I do not think there is a dissentient voice raised in opposition to the strong action which may be necessary in regard to Germany. I cannot but feel, however, viewing the world situation, that we are at a critical moment. Here we have talk of reprisals and retaliation. We have all been thinking of the possible improvement of world trade and trying to generate more good-will and conciliation between nations; we have been looking forward to a stoppage of the shrinkage and to a widening of the channels of the streams of commerce; and here we are, I cannot but feel, discussing equipment for a new trade war. I am not suggesting that there is anyone on the Government Bench who desires that. I feel certain that every hon. Member, and no one more than the President of the Board of Trade and his Parliamentary Secretaries, is anxious to increase world trade, but my reactions, which are instinctive, perhaps, rather than intellectual, lead me to feel that on this issue we are building up armaments.

Viewing the world, we see every nation oppressed with its burden of debts. It is the tangle of debts that is the main inducement to economic nationalism. Every nation has been trying to sell more than it did and to buy less than it did in order to build up a favourable trade balance wherewith to meet its foreign obligations. We cannot dissociate the economic depression from this tangle of debts. We are facing up to a new development in these debts. Here we have one country repudiating its obligations. As I pointed out earlier in the Debate, we have seen practically every debtor country resorting to some subterfuge or other to lessen its burden. It was inflation in the case of France, thereby wiping out something like four-fifths of her contractual obligation. We have one country after another breaking down under the strain. Germany has defaulted without any justification, for I believe its motive has been political rather than economic, and in facing up to that situation we are contemplating equipping the Government with a new economic armament. Who can tell what the developments may be? Who can say what other nations may resort to the same action as Germany's? I cannot help feeling depressed at the outlook conjured up by the talk of this kind of economic warfare.

I feel that Clause 2, and the action which it implies, opens up a whole vista of possibilities. I cannot but feel that it is not quite playing the game. The Government has the whole-hearted support of the House for any action it takes in connection with Germany, but here it is asking Parliament to endow it with stupendous powers, which may bring tragedy to the world. It is an issue worthy of far more attention than has been possible in this Debate. While anxious to support the Government in its action, and anxious that nothing should be said or done to weaken its position in its negotiations with Germany, I feel constrained to vote against it on this issue. I cannot imagine the Government using these powers drastically, I cannot imagine such insanity besetting the mind of anyone; but I do feel that there are consequences so far reaching and tragic in their possibilities that Clause 2 ought not to be included in the Bill, and reluctantly I must declare that I have to vote against the Government.

8.30 p.m.

Photo of Mr John Colville Mr John Colville , Midlothian and Peeblesshire Northern

I feel that the Leader of the Opposition has rather disregarded the realities of the situation. The surprise is not that we are asking for these powers now but that we did not seek them long ago. The House accepted the principle more than two years ago in the Import Duties Act. The principle was that where discriminatory measures were applied to our goods by foreign countries, we should be in a position to reciprocate in such manner as would ensure fair treatment for our exports. It is within the memory of all Members here that that position was accepted by the House. What has developed since to make it necessary for us to seek these powers in relation to quotas as well as import duties? In an answer I gave yesterday I showed that some 21 countries were employing quotas of vary- ing degree, many of them over a wide range of industries. We cannot object to a country applying a quota in its own interests as long as it applies that quota fairly, but when that country applies a quota in such a way as to discriminate against British goods, we should feel that we were neglecting our duty if we did not arm ourselves with the power to secure the removal of that disability.

The hon. Member for East Edinburgh (Mr. D. Mason) has asked why no time was given for trade organisations to be consulted. I hope he will believe me when I say that a number of trade organisations including the Association of British Chambers of Commerce and the Federation of British Industries have constantly pressed the Government to arm themselves with effective equipment to deal with this growing tendency to apply unfair quotas. In taking these powers which we are seeking to-night, we are only doing what is absolutely necessary to the interests of our export trade. I am asked why this should be done hurriedly, why we should not deal with the matter in a more leisurely manner. One reason, and a. most cogent reason in my opinion, is that it is urgently necessary to secure these powers in view of the forthcoming Recess, particularly as similar powers are possessed by most foreign countries, and foreign countries, in handling their quotas in respect to United Kingdom goods, will treat those goods with more respect if the United Kingdom possesses the powers which we are seeking under this Bill.

I have been engaged under my right hon. Friend in a number of commercial negotiations. It would not be proper for me to mention the names of any country in which we may have a fear that unfair quotas are likely to be operated, but I assure the Committee that we are not dealing with any phantom, but are dealing with realities when we speak of the application of discriminatory quotas. Without mentioning the name of any countries, I can assure the Committee that there was one case where we were under a serious threat of discriminatory quotas which would have meant a very considerable diminution in a wide range of our export trades. We secured temporary satisfaction by an arrangement but we are hoping to conclude a more formal arrangement, and in the view of the Government it is necessary for us in the negotiations which we are entering into—I do not necessarily mean entering into immediately, but those which we shall enter into in future—to have at least as effective power to deal with the menace of unfair quotas as we have to deal with the menace of unfair duties. I hope I have shown the Committee that we do not bring this proposal forward in any bellicose spirit. We shall demonstrate, I hope, in the next few days as regards our trade with France that so soon as we get satisfaction in respect of discriminatory treatment against our trade we will be ready to remove our discriminatory counter measures. In that spirit I ask the House to accept this Clause, which only equips us for carrying out a duty we owe to our exporters.

8.35 p.m.

Photo of Mr Alexander Ramsay Mr Alexander Ramsay , West Bromwich

The Parliamentary Secretary to the Department of Overseas Trade has replied to the case which has been presented to the Committee. The necessity of using Parliamentary language has meant that that was not the most effective reply that could be made. The whole Committee and most people outside are very appreciative of the attitude which hon. Members above the Gangway on the Opposition side have taken towards the general principle of the Bill, and it is all the more regrettable that they should, in the vernacular, knock their ankles up against this particular Clause. I should have liked unanimity. On the face of it, there is support for the idea that this provision for the regulation of quotas is something external and outside the Clearing House provision, and that it ought to have been dealt with, if dealt with at all, by means of a separate Bill. I suggest that that is not the case. The questions of the quotas and the Clearing House are so intimately bound up that to attempt to separate them would destroy the Clearing House provisions.

I do not think we can possibly examine this question unless we put it in the historical setting of German trade with this and other countries. Those of us who are intimately connected with industry are terribly conscious of the fact that for two or three years the Germans have been using our money and through the subterfuge of the scripmark, the rentenmark and all the various marks that they have invented, they have been subsidising their export trade at our expense. There is no subterfuge in all the gamut of commercial affairs which the German Reichsbank do not know and do not employ, and they will keep on doing it. By a Bill providing for a Clearing House you are saying that, 20 per cent. of the value of the goods which descend into this country shall be taken in order to liquidate German debts to England, but you are not making any provision whatever in respect of English goods going to Germany. What is likely to happen? Those of us who know the German psychology appreciate that feeling, not onyl in the national sense but in the industrial and commercial sense, is rapidly hardening. I can visualise quite clearly what the German reaction to the Clearing House arrangement would be. You establish your Clearing House and get it working—

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

I would remind the hon. Member that the Clearing House is not included under the Clause which we are discussing.

Photo of Mr Alexander Ramsay Mr Alexander Ramsay , West Bromwich

I appreciate that fact. I was just about to make the point that, if you establish the clearing house, within a month the Government will have to come to the House for permission to impose quotas because of the retaliatory action taken by the German Government against this country. If you do not have the quota arrangement, giving the Board of Trade powers to demand equal treatment by Germany of us, you might as well abandon the whole Bill. I hope the Opposition will not continue their present attitude. We are a great democratic country making a gesture, not of defiance, but of defence against methods which are obnoxious to the people of Great Britain, and, unless we are prepared to make that gesture complete and to arm ourselves with weapons which will become absolutely necessary, it would be better to take no step at all. Unless this Clause is embodied in the Bill, an object which hon. Members on all sides of the Committee have at heart will be defeated. I beg hon. Members not to proceed with their opposition.

8.40 p.m.

Photo of Mr James Maxton Mr James Maxton , Glasgow Bridgeton

I do not know if the speech of the hon. Member for West Bromwich (Mr. A. Ramsay) was directed towards facilitating the progress of the Measure, but so far as I am concerned it has had a contrary effect. The speech of the Minister was the type of innocuous speech which contains the maximum of pleasant manner and the minimum of content, and which is desirable from the Treasury Bench in circumstances like the present. The hon. Member for West Bromwich got down to the issues involved, and those issues are the real basis for the opposition coming from the Labour party and from the Liberal party. The hon. Member describes this as a gesture against something in Germany which is obnoxious to the people of Great Britain. Does he mean the present regime in Germany? This is not a gesture against Hitlerism. If it were, I would not be supporting the opposition to the Clause. Any demonstration that this House can make—

Photo of Mr Alexander Ramsay Mr Alexander Ramsay , West Bromwich

The hon. Member for Bridgeton (Mr. Maxton) will realise that I did not use the term "Hitlerism" at all. I regard the attitude of this House and my own attitude at this juncture as a gesture against repudiation of honourable agreements and against the tendency—call it incipient if you like and not developed—for one country to attempt to bully other countries throughout the world.

Photo of Mr James Maxton Mr James Maxton , Glasgow Bridgeton

I was coming to that as the alternative which the hon. Member might have in mind as something obnoxious. This point as to the repudiation of foreign debts being obnoxious to the people of this country requires a lot of elucidation to me. I candidly admit that I cannot make these very fine lines of demarcation between some repudiations of debt and certain other repudiations of debt. I do not know just when a repudiation of debt is legitimate and when it is not legitimate. I know from my experience in this House that sometimes it is all right. Invariably, when we are doing it, it is all right, but when anybody else is doing it, it is all wrong. It is all a matter which end you are, as to whether it is wrong or whether it is just and statesmanlike. The hon. Member says that the first part of this Measure would be ineffective and inoperative if Clause 2 were not attached. I get more and more interested every day in the depths to which modern private enterprise and capitalism has come.

In our innocence, many of us accepted the suggestion that all that private enterprise and private capitalism needed to get it going swimmingly was a tariff policy. That was going to be the great panacea to solve all the difficulties of international trade and to set our industries on their feet. We did not have that very long before we found that that was not enough. We wanted a clearing house, an arrangement for the regulation of foreign debt payments as well. Now we are told that that is not good enough, but that it must be backed up by a system of nation regulation of quotas and by the imposition of discriminatory methods against foreign countries. I want to know, is this the end? Are we finished now? Is this enough with which to arm the Government? If we allow this Measure, have we the assurance of the National Government that international trade and modern capitalism can carry on successfully, meet their financial obligations and carry through their industrial and commercial processes now that there is a system of tariffs, a tariff advisory committee, a clearing house for debt, and a quota system? Will that be enough? What is to be the next dose? The Minister, in defending the Clause, says that the reason for the urgency is the Autumn Recess. Can he assure me, as a simple Member of the House who admitted candidly yesterday that this is not my special line of political interest, that, if he gets Clause 2, that will carry us through the Autumn Recess?

Photo of Mr George Eady Mr George Eady , Bradford Central

Take the advice that Mr. Asquith gave.

Photo of Mr James Maxton Mr James Maxton , Glasgow Bridgeton

That slogan was not the slogan of a National Government, or of any great Conservative Prime Minister. Always when a Government gets into power it adopts that attitude, but it is not a very noble one or a very intelligent one; it is a sort of Derby day, Ascot frame of mind—

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

Will the hon. Member come back to Clause 2 of the Bill?

Photo of Mr James Maxton Mr James Maxton , Glasgow Bridgeton

I was answering the hon. Member for Bradford—I do not remember at the moment which division he represents—

Photo of Mr James Maxton Mr James Maxton , Glasgow Bridgeton

Oh, yes, it does; the other Bradford Members are very par- ticular, but I am sorry that at the moment I cannot recollect the hon. Member's geographical division. Can the Secretary to the Overseas Trade Department give the Committee any assurance that, if he gets Clause 2, this will be the last thing that he will ask for, until at least another Session of Parliament? Will this take us through the present year, or have we to get something else? I am very interested in the process. I believe, personally, that a stage has been reached where there is only one possible way of dealing with foreign trade, and that is by the State assuming the complete responsibility. I believe you have got to a stage where you have to have a State monopoly of foreign trade—of what is coming in and what is going out. Why the Government should follow this system of instalment trading I do not know, because quite obviously it is not possible with any hope of success to work up a bastard, hybrid system that is partly private trading and partly State action. There must be either the one or the other. The Government are leaving private trade responsibilities as rapidly as they can; they are taking two huge steps in this present Measure, and I ask them, why not face the responsibility intelligently, in a Measure brought before the House for the purpose of organising national trade, instead of in a Measure that is brought before us under the excuse of entirely different purposes?

Yesterday the Government came to the House and asked for this Measure for a limited, specific purpose; but they put in Clause 2, which has only the very slimmest relationship to that purpose. The hon. Member has made the point that Clause 1, to which, as he pointed out, the House was generally ready to agree, is not an effective instrument—that it is useless, futile, that it is only Clause 2 that matters. But Clause 2 is a wide and general thing spreading over the whole world. It is not limited to the question of Dawes Loans, Young Loans, or Germany; it is world-wide in its operation. Hon. Members on the Liberal benches have laid some stress on the fact that the Government have limited the operation of the Measure, including Clause 2; but nobody here is so innocent as to believe that, after this Government have set up a machine which is going to cost £75,000 a year, and have got that machine working under competent men, it is going to be cut off at the end of two years. If this system is working, and a new Government comes into office, either composed of Members on the Labour benches, or of Members on the Liberal benthos, or a combination of both—it is a bit of a nightmare, but one surely is allowed to speculate on these political futures—whichever one of those Governments happens to be in power when the present one goes out, as it indubitably will, if this machine has been set up and is in action it will not be scrapped, but will be carried on.

Look at the Minister himself. His Department has been condemned to death I do not know how many times. The Department of Overseas Trade has been condemned to death again and again by successive Governments, and yet there the Minister sits to-day in charge of this important Measure, while the President of the Board of Trade sits silently beside him in a subordinate position. Do not let us delude ourselves with any idea that this is a temporary Measure for temporary purposes. If it goes on to the Statute Book, and the quotas are set up, and the office is staffed and set going, and particularly if there is an income coming in, it will not be temporary. Let me give a relatively small example. In pre-War days it was an absolutely unknown thing in this country to have a passport system. We set up a passport system and a visa system as a department of the Foreign Office. It has gone on continuously since the War under successive Governments, Labour, Conservative and National. There is a staff there who have a vested interest in its going on; there is an income from the payments made by foreign visitors; and the institution goes steadily on, although the reasons which forced its establishment originally have long since passed away.

That is what you are doing here to-night. You are setting up a permanent instrument for regulating foreign trade, and the question we should be discussing is whether we are setting up an efficient instrument which can do the job in an efficient way or whether we are simply slapping down two spasmodic unconnected ideas that happened to start into the mind of the responsible Minister at the moment when he got angry about the repudiation of the Dawes and Young Loans. That is what the Measure is, a legislative expression of the bad temper felt by the responsible Minister of the Crown at the moment he heard that the Germans were going to repudiate the interest on those loans. That is all that this is, a bit of bad temper, when really, on the general issue of the regulation of foreign trade, some thought and some statesmanship is required—some serious planning and some serious regulation. Instead of that, we get a bit of bad temper, unrelated, in some respects, contradictory proposals in the same Measure, merely in order that the British Government may act as a debt collector for bondholders who were foolish enough to put their money into these investments.

If the British Government are going to start as debt collectors for all the people who have made investments, whether on the Stock Exchange or on racecourses or anything else, they are going to have a devil of a busy time in the next 10 years, because most of the investments are going to be bad ones. While one has no hope of rejecting the Measure now, I trust that in subsequent stages they will take out this bit, which has no relation to the immediate problem to be confronted, and, if they feel that it is necessary to do something more in the way of regulating foreign trade, if they are prepared to tell us that their policy during the last two years has failed completely and that something more is needed than tariffs and tariff boards and bi-lateral agreements between nation and nation that the President of the Board of Trade has spent most of his time on—if they tell us that all this has proved a frost and a fiasco and the whole thing has to be approached in some new way, that will be a different proposal which we shall be ready to look at and discuss in a decent and friendly way. I agree that it is not fair on a relatively minor issue to bring forward a trade policy which is a major issue in a Measure of this description. I Hope those

who are responsible for the opposition will carry it to the Division Lobby and, if they do, I promise them that they will get from Independent Labour what they will get from no other party in the House—100 per cent. support.

3.59 p.m.

Photo of Sir Geoffrey Mander Sir Geoffrey Mander , Wolverhampton East

A good test to apply to the repudiation of debt by a Government is whether that Government have deliberately manipulated the situation as a matter of policy which makes the payment of the debt difficult or impossible. The Minister just now made no pretence whatever that the provisions of this Clause are necessary in any way to help the Government in dealing with the emergency that has arisen out of the German repudiation of debt. If he had said that in the opinion of the Government it was very important to arm them with these powers for dealing with the German situation, that would have had considerable weight with me, but, in view of the fact that it has been made clear that the Government do not require these powers at all for the German emergency but are asking for them for quite other matters of long-range policy, I do not think we ought to consent to incorporate it in the Bill. It seems to me an abuse of the situation. We quite agree that it is reasonable to rush through a Bill in the course of two days to deal with the specific case of Germany, but to attach to it a Clause which in the ordinary way would lead to considerable debate and negotiations with trading organisations throughout the country is not fair to the House. We are all anxious to give the Government all the powers necessary to deal with the situation, but I do not feel that it is playing the game to force upon us, as part of the same Parliamentary manoeuvre, a wide policy of a totally different nature.

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

The Committee divided: Ayes, 192; Noes, 60.

Division No. 306.]AYES.[9.2 p.m.
Acland-Troyte, Lieut.-ColonelBarclay-Harvey, C. M.Broadbent, Colonel John
Adams, Samuel Vyvyart T. (Leeds, W.)Beauchamp, Sir Brograve CampbellBrown, Col. D. C. (N'th'l'd., Hexham)
Agnew, Lieut.-Com. P. G.Beaumont, Hon. R. E. B. (Portsm'th, C.)Browne, Captain A. C.
Alexander, Sir WilliamBetterton, Rt. Hon. Sir Henry B.Burghley, Lord
Applin, Lieut.-Col. Reginald V. K.Blindell, JamesBurnett, John George
Aske, Sir Robert WilliamBoulton, W. W.Campbell, Sir Edward Taswell (Brmly)
Atholl, Duchess ofBowyer, Capt. Sir George E. W.Caporn, Arthur Cecil
Baldwin, Rt. Hon. StanleyBraithwaite, J. G. (Hillsborough)Carver, Major William H.
Balfour, Capt. Harold (I. of Thanet)Brass, Captain Sir WilliamCassels, James Dale
Cayzer, Mal. Sir H. R. (P'rtsm'th, S.)Hunter, Dr. Joseph (Dumfries)Ruggles-Brise, Colonel E. A.
Chamberlain, Rt. Hon. N. (Edgbaston)Hunter, Capt. M. J. (Brigg)Runciman, Rt. Hon. Walter
Christie, James ArchibaldJames, Wing.-Com. A. W. H.Runge, Norah Cecil
Cobb, Sir CyrilJamieson, DouglasRussell, Hamer Field (Sheffield, B'tside)
Colville, Lieut.-Colonel J.Jennings, RolandRutherford, John (Edmonton)
Conant, R. J. E.Joel, Dudley J. BarnatoRutherford, Sir John Hugo (Liverp'l)
Cook, Thomas A.Jones, Lewis (Swansea, West)Salt, Edward W.
Cooke, DouglasKer, J. CampbellSandeman, Sir A. N. Stewart
Copeland, IdaLaw, Sir AlfredSanderson, Sir Frank Barnard
Crooke, J. SmedleyLeighton, Major B. E. P.Scone, Lord
Crookshank, Col. C. de Windt (Bootle)Lennox-Boyd, A. T.Selley, Harry R.
Crookshank, Capt. H. C. (Galnsb'ro)Levy, ThomasShakespeare, Geoffrey H.
Cruddas, Lieut.-Colonel BernardLiddall, Walter S.Shaw, Captain William T. (Forfar)
Davies, Edward C. (Montgomery)Llewellin, Major John J.Shepperson, Sir Ernest W.
Denman, Hon. R. D.Lumley, Captain Lawrence R.Simmonds, Oliver Edwin
Danville, AlfredMacAndrew, Lieut.-Col. C. G. (Partick)Skeiton, Archibald Noel
Dickie, John p.McKie, John HamiltonSmiles, Lieut.-Col. Sir Walter D.
Dower, Captain A. V. G.McLean, Major Sir AlanSmith, Sir J. Walker- (Barrow-In-F.)
Drewe, CedricMacmillan, Maurice HaroldSmith, Louis W. (Sheffield, Hallam)
Drummond Wolff, H. M. C.Macquisten, Frederick AlexanderSmith, Sir Robert (Ab'd'n & K'dine, C.)
Duncan, James A. L. (Kensington, N.)Magnay, ThomasSomervell, Sir Donald
Eady, George H.Maitland, AdamSomerville. D. G. (Willesden, East)
Edmondson, Major Sir JamesMakins, Brigadier-General ErnestSotheron-Estcourt, Captain T. E.
Elliot, Rt. Hon. WalterMargesson, Capt. Rt. Hon. H. D. RSouthby, Commander Archibald R. J.
Ellis, Sir R. GeoffreyMayhew, Lieut.-Colonel JohnSpencer, Captain Richard A.
Emmott, Charles E. G. C.Mills, Major J. D. (New Forest)Spens, William Patrick
Emrys-Evans, P. V.Milne, CharlesStanley, Rt. Hon. Lord (Fylde)
Essenhigh, Reginald ClareMoore, Lt.-Col. Thomas C. R. (Ayr)Stevenson, James
Everard, W. LindsayMorris-Jones, Dr. J. H. (Denbigh)Stones, James
Fleming, Edward LascellesMorrison, William ShephardStrauss, Edward A.
Ford, Sir Patrick J.Moss, Captain H. J.Strickland, Captain W. F.
Fremantle, Sir FrancisNation, Brigadier-General J. J. H.Stuart, Hon. J. (Moray and Nairn)
Galbraith, James Francis WallaceNicholson, Godfrey (Morpeth)Sutcliffe, Harold
Ganzoni, Sir JohnNormand, Rt. Hon. WilfridTate, Mavis Constance
Goodman, Colonel Albert W.O'Donovan, Dr. William JamesTempleton, William P.
Graham, Sir F. Fergus (C'mb'rl'd, N.)Palmer, Francis NoelThomas, James P. L. (Hereford)
Graves, MarjoriePearson, William G.Thompson, Sir Luke
Greene, William P. C.Peat, Charles U.Thomson, Sir Frederick Charles
Grimston, R. V.Perkins, Walter R. D.Thorp, Linton Theodore
Gunston, Captain D. W,Petherick, M.Todd, A. L. S. (Kingswinford)
Guy, J. C. MorrisonPeto, Geoffrey K. (W'verh'pt'n, Bilston)Wallace. John (Dunfermline)
Hacking, Rt. Hon. Douglas H.Pike, Cecil F.Ward, Lt.-Col. Sir A. L. (Hull)
Hales, Harold K.Procter, Major Henry AdamWaterhouse, Captain Charles
Hanbury, CecilRaikes, Henry V. A. M.Whyte, Jardine Bell
Hanley, Dennis A.Ramsay, Alexander (W. Bromwich)Williams, Herbert G. (Croydon, S.)
Hannon, Patrick Joseph HenryRamsay, Capt. A. H. M. (Midlothian)Willoughby de Eresby, Lord
Haslam, Henry (Horncastle)Ramsay, T. B. W. (Western Isles)Wills, Wilfrid D.
Haslam, Sir John (Bolton)Ramsden, Sir EugeneWindsor-Clive, Lieut.-Colonel George
Hellgers, Captain F. F. A.Rankin, RobertWise, Alfred R.
Heneage, Lieut.-Colonel Arthur P.Ray, Sir WilliamWorthington, Dr. John V.
Hepworth, JosephHeld, Capt. A. CunninghamYoung, Rt. Hon. Sir Hilton (S'v'oaks)
Hills, Major Rt. Hon. John WallerReid, William Allan (Derby)
Hore-Belisha, LeslieRhys, Hon. Charles Arthur U.TELLERS FOR THE AYES.—
Horobin, Ian M.Rickards, George WilliamCaptain Austin Hudson and Major
Horsbrugh, FlorenceRopner, Colonel L.George Davies.
Hudson, Robert Spear (Southport)Ross Taylor, Walter (Woodbridge)
NOES.
Acland, Rt. Hon. Sir Francis DykeGrenfell, David Rees (Glamorgan)Maxton, James
Adams, D. M. (Poplar, South)Griffith, F. Kingsley (Middlesbro', W.)Milner, Major James
Attlee, Clement RichardGroves, Thomas E.Owen, Major Goronwy
Banfield, John WilliamHall, George H. (Merthyr Tydvil)Parkinson, John Allen
Batey, JosephHamilton, Sir R. W.(Orkney & Zetl'nd)Rea, Walter Russell
Brown, C. W. E. (Notts., Mansfield)Harris, Sir PercyRoberts, Aled (Wrexham)
Buchanan, GeorgeJenkins, Sir WilliamSalter, Dr. Alfred
Cape, ThomasJohn, WilliamSamuel, Rt. Hon. Sir H. (Darwen)
Cocks, Frederick SeymourJones, Henry Haydn (Merioneth)Sinclair, Maj. Rt. Hn. Sir A. (C'thness)
Cove, William G.Jones, Morgan (Caerphilly)Smith. Tom (Normanton)
Cripps, Sir StaffordLawson, John JamesThorne, William James
Daggar, GeorgeLeonard, WilliamTinker, John Joseph
Davies, David L. (Pontypridd)Logan, David GilbertWhite, Henry Graham
Dobbie, WilliamLunn, WilliamWilliams, David (Swansea, East)
Edwards, CharlesMcEntee, Valentine L.Williams, Edward John (Ogmore)
Evans, R. T. (Carmarthen)McGovern, JohnWilliams, Dr. John H. (Llanelly)
Foot, Dingle (Dundee)Maclean, Nell (Glasgow, Govan)Williams, Thomas (York, Don Valley)
Foot, Isaac (Cornwall, Bodmin)Mainwaring, William HenryWilmot, John
Gardner, Benjamin WalterMallalieu, Edward Lancelot
George, Megan A. Lloyd (Anglesea)Mander, Geoffrey le M.TELLERS FOR THE NOES.—
Greenwood, Rt. Hon. ArthurMason, David M. (Edinburgh, E.)Mr. G. Macdonald and Mr. D. Graham.

Question, "That this House doth agree with the Lords in the said Amendments," put, and agreed to.

Clause 3 (Contents of Orders), ordered to stand part of the Bill.