Debate on the Address

Part of Sessional Orders – in the House of Commons at 12:00 am on 12 November 1963.

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Photo of Sir Harmar Nicholls Sir Harmar Nicholls , Peterborough 12:00, 12 November 1963

I had finished my party contribution, but I will answer the hon. Gentleman nevertheless.He said that his Government were responsible for this country being at the top of the league, but that was at a time when other members of the league had not got their teams together. We were top of the league when Germany, Italy and Japan were still under the rubble. We have an excellent football team in Peterborough. That team had no trouble to keep at the top of the Fourth Division. Now, excellent though it is, it is only half-way up the Third Division because it has to compete against different quality.

Surely the hon. Gentleman can see that when we are talking of competition there is all the difference in the world between the time when Germany, France, Italy and Japan are going all out, and the years when the Labour Party were in power. Not only were those countries not in the hunt in those years, but in the intervening years they have had thousandsof millions of dollars from America, which has enabled them to have the most up-to-date factories compared with ours. It is only in recent years that we have had to meet full competition from these new factories built by this American money because they lost the war. We are having to pay the price of having won the war.

That is the last of my party points. What I am urging on the Government is this. Whatever may have to be done in our approach to the G.A.T.T. or in finding ways and means round various agreements we have signed, we must encourage our exporting industries to increase their figures. I have pointed out before that 33⅓per cent, of our total exports are done by 40 firms only. There are 8,000 members of the Federation of British industries. Too many medium-sized and smaller firms, because of the easy home market, find that it does not pay to undertake the risks and expense of exporting. There is no great profit in exporting.

I ask hon. Members opposite to look into this; they will come tothe same conclusion. Many of our exporting firms find that there is hardly any profit in it. Of course, people keep businesses together, maintaining a part which does not pay, in order to keep their staff and plant going. In innumerable instances, those who at present are playing a big part in exporting find that it is not so profitable a part of their business as home trade. A tax concession would encourage those who are not prepared to take the risk to make the effort and do some exporting.

I could well understand the argument used in past years in saying that we should not give export incentives. In 1938 and 1939, for instance, it was in the interest of the nation to say, "If we can freeze the position as it is now, not getting everybody to give these incentives, it will be best for this country". But that was when we were doing about 28 per cent, of total world trade. If we could have frozen the position at that level, we should have been sitting pretty with the present volume. But now our share represents about 16 or 16½ per cent, of total world trade, and this is not big enough. We must make our share larger, and we can do this only if there are clear and tangible inducements of the kind I have suggested.

One could argue that the giving of similar incentives by other countries would harm us. This is not so, but I will confine myself today to making the one point—no doubt, we can come back to it on the next Budget. I say that, if we want to implement the great programme outlined for us, we must get our balance of trade figures right. To do

this, we must increase our exports, and for this purpose a tangible lead and contribution must come from the Government. I urge that there should be a tax concession to ensure that our industries do better in this direction.