123

A.—6a

No Fixed Percentage of Preference. Recently, however, a closcr investigation had been made in an endeavour to find out whether it would b5 possible to agree upon a uniform policy for all Departments, and in particular whether there should be laid down a fixed or a minimum percentage of preference. The conclusion had been come to that it was not desirable to fix any definite percentage, or any maximum, nor was it desirable to make any public announcement of the particular preferences given. Of course, for more than one reason it was necessary to retain power to suspend the preference if faced with certain circumstances. Difficulty of stipulating for Empire Raw Materials. A further point to consider was whether the preference should be extended to raw materials used in the manufacture of goods required by a Department, but experience had shown that it was impracticable to lay down an invariable rule, since the exact origin of such materials was often impossible to trace. Nevertheless, administratively it is possible to ensure to a very large extent that the raw materials are Empire raw materials. It had been suggested, on behalf of the colonies and. protectorates, that tenders should, be called for " duty paid '' whore a preference is given, so that the benefit of the preference should be secured in all cases. That substantially is the practice of the British Government. The Chancellor gave instances to show that if there had been any exceptions they were practically negligible in quantity. Practice of Colonies and Protectorates. Mr. Qrmsby-Gore said he had not much to add, but he would like to take up the point raised by the Chancellor of the Exchequer about the difficulty of tracing back to their raw material sources the materials used in British contracts. He read the following letter, which he had received the week before from the Crown Agents for the Colonies, which was instructive as an example of the difficulties that had to be met: — " We recently had a case in which, we placed an order for pumps with a firm of well-known English makers, but to our surprise we were afterwards told that the pumps were to be made in America by their American branch. This, I need not say, was not at all what we desired, and wo are now adding to all our forms of engineering contracts the following phrases : 'In the case of stock materials not of British manufacture the place of origin must be stated when tendering. When it is proposed to manufacture the whole or any part of the work abroad the names and addresses of the proposed manufacturers, and a list of the parts proposed to bo obtained from them, must be stated when tendering.' This formula is not suitable for ordinary store contracts, in. which we are going to add : 'In the case of materials not of British manufacture the place of origin must be stated when tendering.' " If that could be added to the contracts they would have knowledge 011 which to base possible future action. At present he was afraid, that a certain number of contracts, given nominally to British firms, were made either of materials produced outside the Empire or were actually handed over by those British firms to branches or firms in alliance outside the Empire. He outlined the practice of the colonies and protectorates, as it might serve as an encouragement to Great Britain and the Dominions to give them reciprocal treatment. Ever since the Colonial Conference of 1902 there had been an instruction to the Crown Agents for the Colonies, who worked under the Secretary of State for the Colonies and were the purchasing agents for Colonial Governments, to give effective preference to the products of the Empire over those of foreign countries. Their practice was to invite tenders from selected British firms only. Foreign firms were only asked to tender in very exceptional circumstances—e.g., when some special article was required which was not produced at all in the Empire, or when it was necessary, as in the case of certain old telephone apparatus, that the parts required for renewal or expansion should correspond with the old apparatus already installed. The practice of the Crown Agents could stand examination. He gave the following example : The drug salvarsan was required for some of the dependencies ; a German firm made an offer to the Colonial Government at about half the price of the British article, but the Secretary of State had asked the Colonial Government to order their supplies of the drug from British manufacturers in spite of the difference in price. He felt that we had to develop, and if Governments —-State, provincial, and local' —-set the example in this matter private individuals might follow suit. He did not want to lay down a hard-and-fast rule, but at a time like this the public Departments throughout the Empire should do all they could in the wording and framing of their contracts to secure the use of Empire materials and Empire products. Colonial Contracts given to Dominions. Mr. Amery said that in recent years a habit of the Crown Agents had been not only to encourage Empire materials generally, but to encourage Empire-finished manufactures. He gave several instances showing that the Administrations of the colonies and protectorates were anxious to help not only the interests of the Mother-country, but the interests of every part of the Empire. Preference in Admiralty Contracts. As regards the Admiralty, they gave a preference sufficiently substantial to eliminate, apart from oil, all but I per cent, of for.iegn purchases. They had been able finally to transfer their last purchases of Argentine meat to Australia, and all meat for the Admiralty now comes from Empire sources.