THE New Zealand Herald AND DAILY SOUTHERN CROSS WEDNESDAY, JULY 10, 1929. BRITISH SAFEGUARDING.

New Zealand Herald, Volume LXVI, Issue 20303, 10 July 1929, Page 10

THE New Zealand Herald AND DAILY SOUTHERN CROSS WEDNESDAY, JULY 10, 1929. BRITISH SAFEGUARDING.

It was inevitable that safeguarding of industries should appear early as an issue in the House of Commons. An extension not of the duties themselves, but of the facilities for applying for them, was so vital a part of the Conservative programme that it was elementary tactics to move an exploratory motion to discover what the intentions of the new Government were. This course, adopted by Sir Philip Cun-liffe-Lister precipitated an interesting discussion clinched just before the adjournment by a decisive Ministerial statement. Mr. Thomas Shaw said the Government would accept no further safeguarding applications under the existing law and procedure, no duties now imposed would L>e renewed, and- the Government reserved the right to propose the remission or revision of existing duties in the interests of the country. This, lie said, was a plain, clear statement of policy. He was right, it was. Those who looked forward to the iron and steel industries being given an opportunity to assert their claim to safeguarding duties now know they need look no longer. The textile workers of Bradford, who had agreed to co-operate with the millowners in an early application, find their decision of no moment. Industries at present safeguarded cannot hope for a renewal of the duties, and do not know whether they will run their full term. There need be no doubt about the Government's ability to carry out the expressed intention. It can rely on the full support of the Liberals, who have always denounced safeguarding as the introduction of protection by the back door. The safeguarding duties are doomed to extinction, and, on the present statement of policy, the McKenna duties are due to come up for sentence soon.

It is easy to confuse safeguarding duties with the McKenna duties. Both of them were referred to in the House of Commons debate. Even in the list of duties included under the second name there is a danger of confusion. The advocates of safeguarding point to the motor-car and artificial silk industries as proof that there can be prosperity and an actual lowering of prices despite a tariff which is in essence protective. Their opponents retort that these examples do not help the case for safeguarding, since the duties were not imposed under that system. The plea is a little strained, for the effects of the duty surety would be the same no matter what the method of imposition. Yet the main contention is correct. During the war, import duties were imposed on motor-cars, cinema films, clocks, watches and musical instruments. The main purpose was to discourage their importation in order to save shipping space for more essential commodities. The duties were retained after the circumstances from which they originated had disappeared. They were repealed in 1921 by the Labour Government, restored again in 1925 when the Conservatives returned to power. Artificial silk is also subject to an import duty, though nqt in the McKenna list. In the first instance the tax was imposed for revenue purposes, excise being levied as well as customs duty. At the time when the McKenna duties were restored the duty on imported artificial silk was reimposed without the corresponding excise. Motor-cars and silk are most quoted because these industries flourish and expand. Since 1925, when the safeguarding procedure was established, it has been the medium for applying duties to no more than half a dozen manufactured articles, of which gloves and wrapping paper are the most important. Though never officially stated, it is understood some GO industries have attempted to secure safeguarding duties. Only the small number indicated succeeded in the effort.

The fact that the Labour Government is more downright about abolishing the safeguarding duties than the others is merely an indication that it is human, and swayed by ordinary political considerations. An attack on the McKenna duties will be more stoutly resisted, especially liv a considerable industrial population at Coventry, the chief centre of the motor-ear industry. It was so in 1021, and history will certainly repeat, itself. Whether some or all of the duties go, the Government is sure to be asked what will be put in their place. Mr. Graham, President of the Board of Trade, said his party did not regard free trade, protection or safeguarding as a solutioniof the industrial problem. Some members of it, are orthodox Cobdenites— Mr. Philip Snowden is pronouncedly one. Yet this implied repudiation of all previous fiscal theories is not new. A study of

Labour literature shows that the substitute, somewhat nebulously sketched, is international action to standardise hours, wages and woikiug conditions, so that there can be no pica of unfair competition in favour of tariff protection. Coupled with this has been the hint, several times repeated, of imposing a complete embargo on goods produced by sweated labour. These schemes for meeting, foreign competition as it exists to day—as much a denial of the Cobdenite philosophy, incidentally, as ordinary protective tariffsare part of the larger objective of the Labour Party. Their immediate value for the assistance of industry cannot be seriously claimed to be great. The result is that in sweeping away the duties immediately the Government will, in' the minds of many people, leave a serious gap, with nothing material to fill it. That will be the main criticism of the policy it is proposed to institute without delay.