Orders of the Day — Cotton Industry

Part of the debate – in the House of Commons at 12:00 am on 9 March 1955.

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Photo of Mr Arthur Holt Mr Arthur Holt , Bolton West 12:00, 9 March 1955

They are not yet doing it. They may do so, and I do not want to evade the issue, but the first thing the Government are entitled to say, when looking at this problem to see what plan can be developed to help the industry on the special matter of damaging imports from a country which is providing a subsidy for these imports—I just do not accept the attitude of the President of the Board of Trade on that matter—is, "First you have got to do all you can." I do not think that that has been said sufficiently to Lancashire.

I am quite at one with the people who criticise some of the leaders, both official and otherwise, for crying "Wolf" a long time before it is necessary, and this undoubtedly has had an unsatisfactory impact on other people who are less sympathetic to the troubles Lancashire is now facing than would otherwise be the case.

What can industry do now? Whatever are the views of people about nationalisation or capitalism or a free economy, the Lancashire cotton industry is operating under a system which is more or less that of a free economy and it must put its house in order accordingly. I was glad to hear a fortnight ago that the President of the Board of Trade had accepted the Report of the Monopolies Commission on the Process of Calico Printing, and I hope that action will soon be taken in that direction. However, there is a price ring in the cotton spinning trade which must also go.

When the hon. Member for Farnworth (Mr. Thornton) speaks, I hope that he will be able to say that whatever troubles Lancashire is in, the cotton unions are completely behind the trade in doing everything they can to make it efficient once the spinners have dropped then-ring. As long as any employer adopts any restrictive practice whatever, the unions are entitled to keep their old ways, but when the employers set an example, I hope that the unions will give the greatest co-operation possible.

I am not making a great point of this because I believe the cotton unions have been well ahead of many of the other unions in their attitude to new methods, but one or two of the friends of the hon. Member for Farnworth have not been quite as progressive—I am thinking particularly of one union official in the East Lancashire area who retired some while ago. It would be helpful to most of us if the hon. Member could assure the industry that the unions are behind the industry in its efforts to put its own house in order.

As regards what the Government can do, that is a different problem. I have not been struck by any of the suggestions made so far and I do not think that those hon. Members who have tried to make suggestions have been very happy. Before the hon. Member for Oldham, East (Sir I. Horobin) made his suggestion about quantity restrictions, he seemed to put all the arguments which would show what a bad effect almost any restriction would have.

I do not accept the view of the hon. Member for Altrincham and Sale (Mr. Enroll) who instanced the sales of British bicycles in America and said that, if we put on tariffs or quotas, the rest of the world would follow suit by treating our exports in the same manner. It is one thing to accept dumping from a private firm abroad, since it could not do that indefinitely, but it is quite a different matter to accept large quantities of goods which could only reach us in such quantities as the result of action amounting to a subsidy, however much the President of the Board of Trade tries to talk himself out of it. I am sorry that the right hon. Gentleman said that we could not challenge this, because we do it in the case of coal and steel, and it is a practice which should be stopped.

A while ago Germany complained that she was meeting competition in steel on an unfair basis because the steel industry was getting its coal too cheaply. As the hon. Member for Darwen said, we must get our minds clear on what are good practices if we are to liberalise our trade. If we do not, we shall get in a mess, and the industry which will suffer will be the Lancashire cotton industry. I have in my hand Statutory Instrument 1955 No. 33, the Import Duties (Exemptions) (No. 1) Order. It is the first one for 1955. It deals with the exemption of Import Duty for certain products of the steel industry, most of which go to the car industry. This is supposed to be because there is a shortage of materials in the country at the moment and the car industry must not be jeopardised in its endeavours to win export markets. It is said that in order to be able to introduce its cars cheaply into those markets, the car industry must not have to import any of its raw materials subject to a duty. Therefore, the duty is removed until 18th March. What happens then? It is assumed that by then the steel industry will be able to produce more; the imports will then not be required, and so the protective duty will be restored.

Is there any sense or logic in that when the cotton industry has no protection whatever against its chief competitor? If the cotton industry is to be expected to stand up to world competition it must be able to buy in a world market. It is not doing so; it is buying in a protected market when it is buying in the United Kingdom market at the moment. If it wants to import machinery from abroad it has to pay a tariff. A lot of its other costs are influenced by the fact that other industries are getting protection which it is not getting. The Government must at least see that there is no discrimination against the cotton industry in our attempts to get a greater liberalisation of trade. I hope that the Government will have more to tell us in that respect after they have met the Cotton Board.

If the industry is given a fair deal there is little chance of its having to contract in any quantity, but if it has to, surely now is a better time than when there is a depression. There is no difficulty now. If a cotton mill wishes to close down, nobody need lose anything, least of all the shareholders. The net liquid assets in most mills meet the value of the share holdings, and the workers at most places can get jobs elsewhere. I do not believe a great problem exists here, but I hope that this will not happen and that the Government will take some action to ensure that it does not.