I beg to move, That this House notes with concern the serious situation which is developing in the cotton industry, and regrets the failure of Her Majesty's Government to take effective action to remedy the position. Before I come to the terms of the Motion, I am sure we should all like to welcome back the President of the Board of Trade, in a state, if not of health, at any rate of convalescence, and express the hope that the strain of the debate will not be too much for him. On so important a debate, we certainly welcome his return. It has the additional advantage that it spares the House the ordeal of a winding-up speech by the Parliamentary Secretary. [HON. MEMBERS: "Shame."] If hon. Members opposite think it is a shame, they should have put pressure on the Government to ensure that the Parliamentary Secretary wound up the Monopolies Commission debate instead of the right hon. Gentleman having to speak twice, thus endangering his health.

I understand that there is some controversy about the second part of the Motion, which says that we regret: … the failure of Her Majesty's Government to take effective action to remedy the position. I am rather surprised about the controversy on this subject in view of the fiery speeches which have been made by hon. Gentlemen opposite with constituencies in Lancashire. If they are today going to make speeches half as fiery as they have done, I should have thought that there would be no alternative for them but to vote for the Motion.

Whatever disagreement there may be about that part of the Motion, I am sure the House will agree on the first part, which says: That this House notes with concern the serious situation which is developing in the cotton industry. … All hon. Members in all parts of the House with cotton constituencies will have been very anxious for a long period about the position which is developing.

Perhaps at this stage it is right that I should make a disclaimer of interest in this matter. I noticed one or two newspapers and financial journals suggesting that the line that I took on the subject of calico printing a fortnight ago was dictated by the fact that I represent a marginal Lancashire seat and that this would be a popular line in getting me votes. That shows the ignorance about geography of the "Economist, "which is almost equal to its ignorance about economics. All hon. Members know that Liverpool is not famous for the presence there of the cotton industry. I have no textile mills, much less calico printing establishments, in my Division. I have no cotton textile workers there so far as I know, and any reference to cotton there is received with almost as much boredom as a reference to the editor of the "Economist. "Nevertheless, I think that the right hon. Gentleman will agree that anyone who has had the honour to hold the office which he at present holds must inevitably be concerned about the present position and the future of the cotton industry.

We on this side of the House have been very restrained in not pressing for a debate on this subject a great deal earlier. It was 8th July last year when the Cotton Board sent an appeal for help to the Board of Trade. All hon. Members in all parties were informed of the appeal. After eight months nothing has come from the President, except a number of suggestions to the effect that Lancashire was squealing before she was hurt. We have had no direct action whatsoever from the Government. We have, indeed, shown restraint in not pressing for a debate.

I have no doubt at all that the right hon. Gentleman will say that we should not be having a debate now because the matter is being considered by the Cotton Board and that he has just asked the Board to do that. I hope he will not suggest that the Board is a kind of inverted B.B.C. and that the House is not allowed to discuss any matter which is liable to be discussed by the Cotton Board in the next 14 days. The fact is that he referred the matter to the Cotton Board for advice only after a number of hon. Members from this side of the House, and some from the other side, started pressing him very hard on the question of Indian imports.

We shall be told that the Prime Minister, whose indisposition we all regret, is to see representatives of the cotton industry and that it is, therefore, perhaps untimely for us to debate the matter. However, the Prime Minister, who sat on the invitation that he had from the cotton industry for well over a fortnight, only replied to the cotton industry agreeing to the meeting after the Motion was put down.

I have a very high regard for the Cotton Board, and a far higher regard for development councils in general than the right hon. Gentleman has, and I think we should all want to pay tribute to the very statesmanlike work that Sir Raymond Streat has done as Chairman of the Board for many years. I tend to feel that why the President has specifically summoned the Board to this meeting rather than the producers' organisations is that he would naturally assume that there would be divided counsels on the Board. The Board includes representatives of the merchants and converters, and one can assume that their strength will to some extent balance the views of the trade unions and the producers' organisationson that body. It may very well be that no agreed proposals will come out of the Cotton Board and that all the President of the Board of Trade will have gained from it will have been time.

I said that we have shown restraint in not asking for this debate before. I think we have also shown restraint in the fact that no one, on this side of the House at any rate, has been suggesting that we should tackle this problem on the basis of simple protectionism. There was, of course, that snarl in the "Manchester Guardian" on Monday morning suggesting that for the sake of some votes in Lancashire we were throwing over all our fiscal ideas about tariffs and quotas. I hope to deal with that comment in a few moments.

Incidentally, it is rather significant that for once the "Manchester Guardian" has made no proposals itself about how this problem should be dealt with. Usually we get a lot of advice, whether Government, Opposition, or industry, from the "Manchester Guardian" about how to deal with our problems. It is remarkable that that newspaper has not put forward any suggestions this time.

We have not adopted, as would have been easy for an Opposition to adopt, the cry of many interests in Lancashire for protectionism. That contrasts very markedly with the attitude of a number of Tory newspapers and candidates in 1951 when we were the Government and there was the problem arising from Hong Kong goods coming to this country. In some Lancashire constituencies the Election was fought on that question, and candidates and newspapers missed no opportunity to advocate that the problem could be dealt with only by a quota. The right hon. Gentleman has shown reluctance to deal with the problem by quota in the case of the Indian imports.

I hope the debate will be dealt with in a constructive manner. Certainly we shall not impugn the right hon. Gentleman's motives for his treatment of Lancashire. I am not going to repeat the charge frequently levelled at him by many employers, as well as trade union representatives, that the Government have written off Lancashire. I admit that all the evidence points to the suggestion, but I do not believe it. [Laughter.] No, I accept the assurances of the Chancellor of the exchequer on this, despite the evidence. The Chancellor is very touchy about this charge. Recently he was in Manchester and repeated it, and, after denying it, said that he had been brought up on the doctrine, "Never believe more than half you are told." Therefore, I accept his assurance that the Government have only half written off Lancashire. However that may be, the Government have certainly dealt some very serious blows to Lancashire's prosperity over the past year. About a year ago we had a series of debates in this House about three blows which fell in a matter of weeks. The first was the decision of the Chancellor of the Exchequer not to remove Purchase Tax. The harm that has been done to the industry by Purchase Tax has been argued many times from this side of the House when debating the D scheme. In the "Manchester Guardian" this morning a very powerfully argued article appeared on that question.

The second blow the Government dealt the industry was the Japanese Trade Agreement, and the events of the past year have gone a long way to confirm the warnings we gave from this side of the House at the time of the signing of that Agreement. The third blow was the decision of the Government to abolish the Raw Cotton Commission and to restore the Liverpool Futures Market. While not all the disasters we then forecast have yet happened, for the very obvious reason that the Liverpool cotton market has been operating against a favourable economic background, we warned the Government then that if another dollar crisis came it would have a very serious effect on Lancashire and the Liverpool cotton market. Now we must ask the President what will be the position of the Liverpool cotton market if the Chancellor's Bank Rate gamble and confidence trick fail to come off and they have to restrict the dollars available to the market.

Figures given in this House have shown that imports from Commonwealth countries were 34·9 per cent. of the total in 1953 and 26·7 per cent. in 1954, which is what we said would happen. Imports from the dollar area have risen from 28·3 per cent. to 34·6 per cent., and long-term contracts with Colonial Territories have been wound up. That is a very serious state of affairs, particularly if a dollar crisis is on the way. We always said that a free enterprise raw cotton market was a fair weather ship; it would probably function pretty well so long as storms did not blow up, but I am not sure that it is functioning well now. We have had some very serious comments made in Lancashire about the futures market, for instance, by the Chairman of the District Bank a few weeks ago.

I also notice that "The Times Review of Industry" says that there is some anxiety about the smallness of business passing through the Liverpool Futures Market. It says: Transactions have become fewer than they were in the first two or three months after the market reopened, and now there are not enough of the small sales or purchases from occasionally producing disproportionately large effects on prices. Many traders are clearly fighting shy of the Liverpool market and transacting their futures business at New York. It goes on to say that no spot stock of any dimensions has been built up. Indeed, our cotton stocks today are lower than they were during the Battle of the Atlantic. They are lower than at any time since the American Civil War. I ask the Government what position that puts us in if we have to face any kind of emergency, including, for instance, a dock strike? The Liverpool market is not being used by the big spinning interests and is becoming only a Shadow of what the President intended it should be. "The Times" also says: Some change is needed if the market is not to sink into inanition. I have referred to the very serious contribution of the Government a year ago to Lancashire's depression. Certainly since last year the position has very seriously worsened. At Christmas very many mills had extended holidays as a means of allocating and spreading work and disguising short time. A very large proportion of mills are not actually closing or going on short time but are keeping their operatives because they fear they will not be able to get them back if they let them go; and they are all on a guaranteed week. I ask the President of the Board of Trade how many mills are at present on a guaranteed week? I have heard it stated that between 10 and 15 are on a guaranteed week. I should like him to tell us whether that figure is correct, or whether it is higher or lower. I expect he has seen the figures in the Ministry of Labour Gazette.

I know that the Government will say that the last short-time figures only show the industry as a whole, but these figures were collected in August and November—