An Unstable Key Industry.
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IN ALL that has gone before, we have presumed— we hope without justification—that the term "Key Industry," as used by the Prime Minister, was intended to apply only to a very limited number of brand new industries practically non-existent prior to the war. There still remains, however, the possibility that the fact that the motor industry is a " key " industry may be recognized ; in which case, the Board of Trade will have power to prohibit. motor imports except under licence, and to charge fees for licences
so as to prevent excessive imports. . Mr. Lloyd George has tried to explain what he means by the Unstable Key Industry and has taken four tests. The first is--whether the industry was
. revealed to be essential for war or the maintenance of the country during the war. The industry with which we are concerned was undoubtedly revealed to
be essential on both counts. Presumably no one would question this. . The second test is—whether, during the war, it was discovered that the industry had been so neglected that there was an inadequate supply of goods produced by the industry for the purpose of equipping ourselves for the essential task of war. Unfortunately this was found to be the case. The whole of the resources of the industry were concentrated on the supply of our military requirements. But, nevertheless, some importation of motor vehicles continued to be necessary, while essential civilian requirements in respect of transport had to be grossly neglected to the detriment of our organization at home.
The third point is—whether it-was found necessary for the Government to foster and promote that industry during the war. Here again there can. be no two answers. The Government was perpetually trying to induce motor manufacturers by a variety of means to embark in very special enlargements of their works and plants. Many such enlargements were made, not because the manufacturer wished to make them, but because he felt that, even at his own risk, he had no right to refuse to do everything possible to help the country in times of crisis.
The fourth test is—whether with special Government support, this industry could maintain itself at the level of production which war has ahown, to be essential to the national life. In our case, the Government support took the form of loans to assist extensions and of contracts absorbing the whole output of vehicles. Now, to maintain the output shown to be essential during the war, markets must he found vastly larger than those possessed in 1914; the home market is limited ; the goodwill of British manufacturers at home and, still more, in the Overseas markets, has been terribly depreciated. It seems clear, then, that, when we study the Prime Minister's statement, we cannot avoid the conclusion that the motor industry answers to the description of what he regards as Unstable Key Industries, requiring assistance by the strict limitation of foreign imports.