An explanatory memorandum has been circulated for the information of Senators.
During the year 1971, nine orders were made under the Imposition of Duties Act, 1957, and the Finance Act, 1962. The 1957 Act provides that such orders must be confirmed not later than the end of the calendar year following that in which they are made, if they are not to cease to have statutory effect. The Bill before you today proposes to confirm the nine orders made during 1971.
The first of these orders, No. 189, was made by the Government on the representations of the Minister for Finance and is of a type with which Senators will be familiar. The Anglo-Irish Free Trade Area Agreement provides that on 1st July each year duties against UK goods are to be reduced by 10 per cent. These reductions are effected by an annual order and the order now proposed for confirmation provided for the sixth tariff reduction of 10 per cent on these goods and for the sixth reduction of 10 per cent in the protective elements in revenue duties on certain United Kingdom goods.
This order also provided for the elimination in one step of the protective element in other revenue duties on goods of United Kingdom origin, for example, newspapers, periodicals and hydrocarbon oils. Senators will recall special arrangements for a somewhat accelerated rate of reduction of duties in respect of certain goods of Northern Ireland origin involving a preference in favour of these goods vis-à-vis UK goods. The order provided for the maintenance of this preference. In addition, the order provided (a) for a reduction in the import duty on unassembled motor cycles as a concession to domestic motor cycle assemblers and (b) for a number of changes in the Customs tariff necessitated principally by amendments in the Brussels tariff nomenclature.
The Irish sugar confectionery manufacturers complained to me about the erosion, due to increased prices, of the protection afforded by the specific duty on sweets and toffee, at the time amounting to 6p per lb. (Full); 4p per lb. (Preferential) and 2p per lb. (Special Preferential, UK and Northern Ireland). As the manufacturers appeared to have a good case in that imports were increasing to the detriment of the industry, Order No. 90 provided for increases of 2p per lb. in the specific rates of duty and for imposition of an alternative ad valorem duty of 40 per cent on sweets and toffee from all sources.
Article 1 (5) of the Anglo-Irish Free Trade Area Agreement provided for a review by the Government in the year commencing 1st July, 1970, to ascertain whether an appreciable rise in unemployment had occurred in any sector of industry or region, or was threatened as a result of the reduction of protection under the agreement. If the Government were satisfied that difficulties of this nature had occurred or were threatened, they and the British Government had to consider jointly whether the problem could be dealt with by altering the arrangements for the removal of protection up to 1975, or by extending the transitional period beyond that time.
Article 1 (5) further provided that, if the Irish Government, following the consultations, concluded that the difficulties were so exceptional that they could not be dealt with in this way, they could then exclude a limited number of the goods concerned from the free trade arrangements. Consultations between the Governments were not concluded by 1st July, 1971, and the Governments agreed that, pending the completion of the consultations, the tariff reductions due to take place on that date should not be made in respect of certain iron and steel products, certain agricultural machinery, certain domestic electrical appliances, aluminium holloware, blankets, mobile homes, joinery and leather footwear and should be at a rate lower than 10 per cent in respect of furniture, ropes and cordage and brushes and brooms. Order No. 191 gave effect to this agreement between the Governments.
The changeover to the Brussels nomenclature form of Customs tariff from the form in use before 1963, resulted in an inadvertent loss of protection for certain goods, because of changes in description or definition. Most of these have already been rectified as they came to light. Order No. 192 provided for the imposition of Customs duties on certain metal badges and footwear heels which had inadvertently incurred a loss of protection on the changeover to the Brussels nomenclature.
Order No. 193 increased the minimum specific duty from £3 to £15 on tyres of non-UK origin and of minimum dimensions 7.00 inches by 16 inches. The order was made following representations from the Irish tyre manufacturing industry seeking greater protection of the truck tyre market from increasing imports of large tyres from State-trading and Far Eastern countries.
Order No. 194 was made by the Government on the recommendation of the Minister for Finance. The order provided for a considerable number of technical changes in the Customs tariff necessitated by changes in the Brussels tariff nomenclature and for a number of other minor editorial changes in the tariff. The Customs Co-operation Council meet in Brussels periodically to review the classification of goods in the Brussels tariff nomenclature and to ascertain if technological advances in certain areas necessitate the reclassification of some goods in different headings of the nomenclature.
When the council recommend changes in classification, individual countries often find that new national subdivisions must be raised in the tariff in order to maintain the existing rates of duty for the goods involved. An example of the type of operation involved in Order No. 194 is concerned with mixtures of chemicals and foodstuffs of the kind used in the preparation of human foodstuffs. These items were previously classified under tariff heading 38.19 as chemical products or preparations and were free of duty in the Irish tariff. The council ruled that they should be reclassified at tariff heading 21.07 as food preparations. A new subheading had, therefore, to be raised at tariff heading 21.07 of the Irish tariff to provide for the retention of the free rates of duty for these goods.
Following a resolution adopted unanimously by the United Nations Conference on Trade and Development in regard to the grant of tariff preferences in favour of developing countries, Order No. 195 implemented Ireland's participation in a scheme of such tariff preferences. The tariff preferences extended by Ireland consists of a reduction of 33? per cent below the full rate in the Customs duties on certain industrial products originating in developing countries. These reductions do not apply to certain sensitive products, mainly textiles and footwear.
Order No. 196 was made by the Government on the recommendation of the Minister for Agriculture and Fisheries and gave effect to the measures agreed with the EEC for imposition of new and amended duties on fish, ryegrass seed, tomatoes and apples. The quantitative controls at present operated on imports of these commodities will be abolished following our accession to the EEC and, in order to allow for gradual exposure of Irish producers to full EEC conditions, it was agreed that special arrangements could be made to strengthen our duty protection.
The effect of Order No. 197 was to increase the duties on outerwear of United Kingdom origin from 1st January, 1972, from the rates then in operation, ranging from 9.6 per cent to 16 per cent, to the levels which were in force in 1969-70, ranging from 16 per cent to 24 per cent. Customs duties on outerwear were being phased out on textiles as on other products of British origin in accordance with the Anglo-Irish Free Trade Area Agreement.
Recessionary trends, which had continued to create problems for the industry on a world-wide scale throughout 1970, showed little signs of a recovery during the year 1971. I became satisfied that a further reduction in duties affording increased opportunities for access to our markets by British manufacturers would result in a serious redundancy in the Irish textile industry. Following consultations between the Irish and British Governments, the Irish Government decided to exclude certain outerwear from free trade under the provisions of Article 1 (5) of the agreement to which I have referred earlier. Having excluded the goods from free trade, it was possible to increase the duties to the levels which were in force in 1969-70.
I recommend this Bill to the House.