204

10th January, 1929

My dear Prime Minister,

The cuttings I receive from Australia seem to indicate that the Herald and perhaps one or two other papers are running something of a campaign in favour of increased British preference for Australian products. The fact of the existence of such a campaign may be all to the good, but when one reads statements to the effect that it is only necessary to make a clear statement of the position to the British Government for Australia to receive a preference of 3d. per lb. on butter and a substantially effective preference on canned fruit, I do feel a little alarmed.

As you know, Baldwin [1] gave unequivocal pledges in regard to food taxation at the last General Election. He is already showing signs of doing the same prior to the coming General Election, and I certainly think that from your point of view it would be a thousand pities to let the impression grow in Australia that it would be a comparatively easy matter to secure new food taxes in Great Britain in order that Great Britain should be able to give additional preferences.

I am not going to suggest that something of this sort might not prove possible as the result of a successful Imperial Conference, but I have no hesitation in saying that the achievement of such an objective would be extremely difficult.

My note to you on this subject may be completely unnecessary, but if the campaign which seems to be going on does create an impression in the primary producer's mind that the achievement of new preferences would be easy, I am sure that it is not in your interests that this should occur.

Yours sincerely, F. L. MCDOUGALL

1 Stanley Baldwin, Prime Minister.