HC Deb 23 January 1940 vol 356 cc440-72

Question again proposed, "That the Bill be now read a Second time."

Captain Crookshank

That interruption will make the course of my explanation a little more confused than it otherwise would have been, but fortunately I had reached the end of what I had to say about the gift account. I now pass to the loan account. It would be improper to look to the gift fund, or to the assets of Czecho-Slovak refugees who are here as the result of their country being overrun, or to the balances of Czecho-Slovak subjects who are still in that country for any assistance towards dealing with the financial claims; the only source to which it is proper to go is, therefore, the balance of this loan account. It was a loan to the Czecho-Slovak Government and the money was advanced by His Majesty's Government for the reconstruction of that country. That object of the loan cannot in present circumstances be fulfilled, and I think it is clear that the best use to which it could be put is towards fulfilling the obligations of the Czecho-Slovak Government. That is what it is intended to do. The rights of the creditors against the original debtors will be transferred to the Treasury here. The documents of title can be handed over, should it be desirable and necessary and possible, for use as a set off against the debt of the Czecho-Slovak Government to the Treasury.

The balance in the account at the moment is about £3,500,000. The proposal in the Bill is that that sum should be paid into the Treasury and then paid by the Treasury into a fund to be set up under Clause 2 (1), to be called the Czecho-Slovak Financial Claims Fund, which will be under Treasury control. All that the Bill says with regard to the disposal of that fund is that it is to be used to satisfy obligations incurred before the 15th March of last year by the Government of the Czecho-Slovak Republic, or persons who on that date were resident or carrying on business in the Republic or incorporated under the law thereof. All that the Bill says is that this shall be done as a result of a Treasury Order which will specify which obligations shall be satisfied in this way and the extent and manner in which they are to be satisfied, and that that Order will not be effective until each House of Parliament has approved the draft of it. Clause 4 of the Bill deals with the accounts of these two funds. That is all there is in the Bill and for the convenience of hon. Members we circulated with the Bill the scheme which, if the Bill is passed, is the sort of scheme we propose to embody in the Treasury Order. It is to he found in Command Paper 6154. I do not know how far I shall be allowed to refer to this document. It is not debatable on this occasion because it is only a scheme which we have in mind.

Mr. Boothby

As far as I can make oat, this is the only occasion on which we shall be able to examine this scheme in some detail. When it is introduced as a Treasury Order it will have to be either accepted or rejected in toto. If that be the case, may I ask for a Ruling whether we can have some discussion of the scheme on the Second Reading of this Bill.

Mr. Pethick-Lawrence

May I put it to you, Sir, that in this White Paper we have admittedly the intentions of the Government, and these intentions are what are to be covered by the Bill which is now before us. Therefore, although I do not suggest we should roam over great detail, there would be nothing out of order in discussing the major provisions of the proposed scheme in the White Paper on the Second Reading of this Bill.

Mr. Speaker

It will be entirely in order, without going into specific details of the scheme, to discuss it in connection with the Bill.

Major Procter

Would it be in order to make quotations from the White Paper for the purpose of criticism?

Mr. Speaker

I cannot rule on that until I hear the quotations which the hon. and gallant Member proposes to make.

Captain Crookshank

I am sure the House is relieved by your Ruling, Sir, because it enables us to look into this matter at this stage. It may make it unnecessary to have Debates subsequently on the same subject and we may be able to conclude the affair on this occasion. The claims we propose to admit under this scheme are those in respect of the payment of interest due on bonds or debentures of the Czecho-Slovak State Loan of 1922, the City of Greater Prague 7½ per cent. Mortgage Loan of 1922 and the Skoda Works 6 per cent. 1st Mortgage Debentures; also the Czecho-Slovak guarantee in respect of interest on the Austrian Government Conversion Loan of 1934, which, of course, was a CzechoSlovak Government Guarantee; and further, cash claims against the CzechoSlovak Government in respect of Treasury Bills and bonds and against banks in Czecho-Slovakia, including claims in respect of bank balances. That does not cover every conceivable claim which may lay against Czecho-Slovak subjects. There are good reasons for that.

Sir Irving Albery

With regard to the Austrian Loan Guarantee, does that only cover bonds held by English holders?

Captain Crookshank

I do not want to be led away into details, but I can assure my hon. Friend that, as a matter of fact, this is one case in which payment is not limited to British holders. My hon. Friend knows better than I do the full details of the Austrian guaranteed loan of 1934, under which in case of default each guarantor Government is due to pay its appointed share of the service moneys of each issue of the loan. In point of fact this case would not necessarily be limited to British holders.

Mr. Pethick-Lawrence

On page 3 of the White Paper are the words "shown to the satisfaction of the Treasury.…" To what section does that apply? Does it apply to the whole of the scheme including paragraphs (a), (b) and (c), or does it apply only to (c)? I should like to know in view of what the right hon. and gallant Gentleman has just said.

Captain Crookshank

That phrase applies only to (c). The right hon. Gentleman will observe that similar words appear in paragraph (a). They do not appear in paragraph (b). I was about to say that, of course, this does not cover every conceivable claim that there may be. It deals only with financial claims, and one of the reasons for that is that the amount of money concerned is limited. As will be seen from (c) of paragraph 2 in the scheme, it will not be possible to pay out in full. No payment in respect of any claim shall exceed £1,000 together with one-half of the amount by which the claim exceeds 1,000, provided that no claimant shall receive in respect of one claim more than £50,000. That is because to start with the money is limited; there is only £3,500,000 in this fund.

The other reason why the classes of claims have been restricted is that these loans and bonds and cash claims are, practically speaking, the only kind of claims whose existence can be verified and the solvency of the debtor assumed in the absence of any communication with Czecho-Slovakia. It is not to be forgotten that so long as the Treasury are paying out of this fund the moneys to the claimants it is necessary in the public interest that they should be limited to claims in respect of which the Treasury can secure proper documentary evidence. The payment of the interest on these bonds will be made in respect of bonds shown to be in possession of British residents on 8th May, 1939. That date is chosen because since then dealings in Czecho-Slovakian securities have only taken place when accompanied by a certificate that they were in the beneficial ownership of British holders. Payment will be made in respect of cash claims in cases where the obligations have been registered with the Bank of England and shown to have been owned since 14th March, 1939, by a person who was resident in the United Kingdom since the outbreak of the war. The effect of that is that refugees who have come to settle in this country in the period between the invasion of Czecho-Slovakia and the outbreak of the war will be able to claim under the scheme if they have claims which fall under its provisions.

The only other thing I have to say is with regard to the last date on which claims can be registered with the Bank of England. Claims have been registered for some time past, but it may be that some have not yet been registered, and the latest date for registration is the 31st January this year. I hope that anyone interested in this matter will take note of that fact. I think that in introducing this Bill I have said all that is necessary and hope that I have made the situation clear, and I shall be glad to try to answer any questions which may be put to me, or my right hon. Friend will when he is able to return to the Chamber, before we conclude the Debate; but, as the House knows, of course this is not the only occasion on which hon. Members can raise points which they wish to bring forward.

4.45 p.m.

Mr. Pethick-Lawrence

I think that in one of Lewis Carroll's books relating to the "Adventures of Alice," he said that things became "curiouser and curiouser." This Bill, I think, becomes "complicateder and complicateder," and though I certainly commend the explanation of the right hon. and gallant Gentleman as being as lucid as the subject will permit, I cannot pretend that I have mastered all the details of this scheme, and I very much doubt whether there is anyone outside the Treasury who could put his hand on his heart and say that he understood it all. But I think the main outlines are, after all, fairly straightforward. There are certain funds relating to Czecho-Slovakia which the Government has control over at the present time. There are funds which in some shape or form the Government subscribed itself—that is, from the money of the taxpayers—and there are in addition the funds which the Government blocked. As I understand the Bill and the Treasury scheme and the speech of the right hon. and gallant Gentleman, these other funds, those which were not subscribed in the first instance by this Government, but which the Government blocked at the time when the blocking process was carried through, which was at the beginning of April or the end of March last year, are not touched by this Bill, and I should like the right hon. and gallant Gentleman, or whoever is going to reply, to give us some little information on that point. Are there additional funds which are blocked by the Government? If, as I think, there are, what do they amount to, and what are the intentions of the Government regarding them? I can see certain reasons why they should not be brought into this scheme. It may be there are other purposes for which the Government think they ought to be used, but I think we are entitled to know what is in the Government's mind on that point. I imagine there is no one in this House who would like to see them handed over to Germany either now or at the end of the war. I imagine that, if they are to be kept till the end of the war, they must be kept solely and exclusively for a reconstituted Czecho-Slovakia, independent of any outside control, and I should like someone on behalf of the Government to give an assurance that that is their intention.

That is the first point. My second point is that, as I understand it, there are three or four different sets of persons who stand to get some benefit under this scheme. First of all, in a category by themselves, are the persons who are entitled to get something under the Austrian Guaranteed Conversion Loan who may not either be British subjects or British residents, and I do not say anything more with regard to them. In the second place there are British subjects who will obtain certain sums as a result of the financial claims which are covered by this White Paper. In the third place there are Czech or Slovak persons who are resident in this country who may also hope to get benefit under this claims fund, provided they satisfy the conditions and to the extent referred to in the White Paper. In the fourth place there are Czecho-Slovaks who, whether they are resident in this country or not, may get relief under the other fund which is dealt with in Clause 3 of the Bill. It is conceivably possible, though not very likely, that a Czech subject resident in this country might have a case at one and the same time under both these heads.

So much for the general outline of the proposals. Now I come to one or two points which are more in the nature of details. This Bill and this scheme, as I understand, do provide for payment to a certain extent both on account of cash debts and of interest on certain specified liabilities and the payment in certain cases is to be in certain proportions dependent upon the total of the claim, the smaller claims being met in full, the medium claims being met to the extent of half, and the larger claims not being met beyond a certain amount. I should like to say that I agree in the main with certain features of the Bill. I agree with the definition of a British holder which appears on page 3 of the White Paper. That does extend to Czecho-Slovakian subjects who are resident here the advantage of being repaid these sums if they are in a position which entitles them to secure them. It is not confined to strictly British subjects. I agree, further, with the principle on which the part payments are decided. I think it is reasonable, at any rate in the case of a first instalment, that some selection should be made among holders, and the smaller people paid in full, and that if there has to be a limit beyond which repayment is not made, it should be the larger holders who, for the time being at any rate, have to forego part of the repayment. As I understand it—I may be wrong—if there is enough money there may be a further distribution among the larger holders.

I should like to ask one or two other questions regarding the disposal of such money as does not originate from this country. I should like to know exactly why it is that some of the categories which were referred to in a circular from the Bank of England dated 3rd April, 1939, have apparently been excluded from the scheme. In that circular there were four categories of persons who were entitled to send in claims. There were claims concerning (a) loans issued by the Czecho-Slovak Government or by any public authority or by any corporation; (b) shares or participations in any corporation incorporated before the 15th March, 1939, under Czecho-Slovak law; (c) balances with banks in CzechoSlovakia; and (d) miscellaneous financial obligations such as interest-bearing or revenue-producing claims of persons or institutions in Czecho-Slovakia, but excluding trade obligations. As I understand the new proposals, only claims under (a) and (c) are covered by this scheme. Claims under (b) and (d) are omitted.

Before I pass to the explanation which I understand is the one which the right hon. and gallant Gentleman is likely to give I should like to make one or two comments on the classes of persons excluded in this way. There are all the people who have claims other than those upon banks. For instance, there were in Czecho-Slovakia before the German occupation a very large number of co-operative societies. A great number of Czecho-Slovaks had accounts in those co-operative societies, and under the provisional draft claims put forward in the Bank of England circular of 31d April, 1939, all those people would have had an opportunity of submitting their claims and might have expected to have them met when the scheme was finally drafted. Those people, as I understand it, will now get nothing at all. There are a large number of other people who had certain shares or interests in various other forms of Czecho-Slovak undertakings, and they will all be excluded. Whatever may be the reasons, it seems to me very unfortunate that many of those people, who at the present time are in this country, will under this scheme hold out their hand and find that not bread but a stone is put into it.

Before I came to the House this afternoon I was at a loss to know why it was that these people were excluded, but some words which fell from the right hon. and gallant Gentleman suggest to me what his answer may very likely be. Subsequent to 3rd April, 1939, war has broken out, and therefore we are unable to get into direct touch with the authorities in Czecho-Slovakia, and it may be that the difficulty of substantiating claims may appear to him and to the Treasury to justify the exclusion of this very important group of claims. But is that really the case? I should have thought that a great many of those claims could be substantiated. The claimants must almost certainly have documentary evidence of a fairly conclusive character, and though it must naturally rest upon a claimant to substantiate his claim, if he is able to do so I do not see why he should be ruled out by an a priori classification.

The whole of this scheme is. of course, very complicated, and I may he wrong in thinking that these people are excluded. What I want to know specifically from the right hon. and gallant Gentleman when he replies is: Are these claims, which are classified as claims under (b) and (d) of the original circular of the Bank of England, excluded, and, if they are, cannot the Government promise to reconsider the matter and to see whether an attempt can be made to meet claims which can be clearly and beyond a peradventure substantiated by the claimants?

Those are the main points which I wanted to make with regard to the Bill. There are, however, subsidiary points which I wish to put, before I conclude my speech. The right hon. and gallant Gentleman has answered one of the questions which I had to ask, as to the total assets of the Fund that the Government were proposing to administer. The Government have not given us very much idea of the total amount of the claims. No doubt the claims are not complete, because the Government are giving the claimants up till the end of January to send in their applications. I have a shrewd idea of what the claims are, but I hope that the Government be able to give us some idea of them, if not now, then at a later stage. When we know what the assets are, what the claims are and what proportion of the claims will be met under this scheme, claimants will be in a better position to know what chance there is of there being a further division of assets among them.

Finally, I would like to ask a question as to procedure. As I understand the position, a little after the passage of the Bill the scheme will have to come at some subsequent date before the House for an affirmative Resolution to be passed. When the Government bring forward an affirmative Resolution of that kind it is very difficult for any Amendment to take place, and that is why I think it is of the utmost importance that we should have what you, Mr. Speaker, have been kind enough to indicate, the right to-day to discuss the main principles of the White Paper. If the House wishes for any Amendment of this White Paper it is open to express its wishes. No doubt, between the present time and when the actual Treasury draft order is brought forward, the Government will be good enough to give our suggestions their consideration.

Before I sit down I would like to repeat one important point which I have already made. Assuming that I am right in thinking that a considerable number of very worthy people, with small amounts clearly and definitely documented, are excluded by the scheme as it stands, I would ask the Government to undertake to reconsider that matter and to see whether they can so amend the scheme that some or all of those people are brought within its ambit.

5.5 p.m.

Mr. Boothby

The House has listened with great interest to the right hon. Gentleman who has just spoken. If I may venture to say so, I do not think it would be practical for the Government to meet the commercial claims of CzechoSlovakians because the difficulty of substantiating such claims would be almost insuperable. Further, we do not really possess corresponding assets in this country to cover such claims. We have cash assets, and it seems to me that the only claims which can be legitimately set off against those assets are cash claims. therefore, agree entirely in this respect with the Government's policy; we are paying cash claims out of cash assets held. I do not entirely agree with the method, but the principle is one from which it would have been very difficult to escape at any time. We do not hold mortgages, or shares, or commercial debts in this country, corresponding to similar debts in what was Czecho-Slovakia.

Mr. Pethick-Lawrence

At any rate the impression of the Bank of England at the time the circular was issued was that it definitely contemplated doing so. It would not have put forward ideas which it thought it would be impossible to carry out—unless circumstances have changed as I believe they have, to some extent. At that time the Bank did contemplate it.

Mr. Boothby

The war has made a decisive difference, because we cannot now get into touch with what was Czecho-Slovakia. The Bank of England probably had two reasons for the action they took. The first was that they wanted information generally as to what sort of debts were owed by Czecho-Slovakia to this country. It would be natural for them to want as much information on that point as possible. Secondly, at that time it was possible that we might do a deal on behalf of these claimants with the German Government. That was before the war broke out. Once the war broke out, the situation entirely changed. I sympathise with the Government to this extent, that I do not see how they could meet claims other than cash claims, because these are the only claims against which we hold precisely corresponding assets, and which can be precisely ascertained in the present circumstances. When my right hon. and gallant Friend said that he did not think that bank balances in Czecho-Slovakia ought to be touched at the present time, I confess I could not quite follow him. They seem to me to come very much into the category of assets which can be touched.

All I want to say at the moment is that the House is glad that the Treasury have produced a draft scheme for our consideration—after a very long wait. My right hon. and gallant Friend rightly pointed out that the Bill as such is merely an enabling Bill. The scheme is the thing. I am sure that the House will be very grateful to the Treasury and to the Government for having produced, in the form of a White Paper, a draft of the scheme which it is proposed to introduce. The House will thus have the opportunity to make some observations. My right hon. Friend opposite has indeed already made some very important and interesting observations. If the House has any say in the matter—and I think it ought to have some say—I would ask my right hon. and gallant Friend not to reply in detail to-day to any points of criticism that we may put; but I would ask for an assurance that the Treasury will consider all the views expressed in this Debate before the final Treasury Order is submitted to us; because the order cannot be amended in detail, and probably, when the moment comes, it will be passed without further discussion.

The most interesting thing about the proposals of the Government is that the Czech assets, about which we have heard so much, remain blocked. It is only the unexpended balance of the British Government loan to Czecho-Slovakia which is to be used to satisfy certain claims. The assets remain in our hands; and they may, according to the figure given to the House by the Chancellor of the Exchequer, amount to £17,000,000. They were £16,000,000; but, owing to the rise in the price of gold, they rose to £17,000,000. I agree that the Government might give us a little more information about their intentions with regard to this very substantial sum of money. Is it to remain blocked in this country? What do the Government intend to do? Will they keep this money frozen, or put it to some use? Is the money to remain idle? Of the £21,000,000-odd held in London on 14th March last, on behalf of the late Czecho-Slovakian State, over £5,000,000 in gold has been handed to Germany by the Bank for International Settlements. Is the remainder to be kept completely immobilised, in a kind of cold storage, for an indefinite period, when it might be put to productive use in this country? That is a point which worries me not a little.

Turning to the actual scheme in the White Paper we have, I think, too little information from the Government at present to enable us to judge of its merits—to know whether it is a fair or an unfair scheme. We have not the faintest idea what the cash claims amount to, and the Treasury have not given us any estimate. We know that there is £3,500,000 with which to meet the claims but we do not know what the claims amount to. They may well amount to less than that sum, and if that is the case the scheme seems to be very fair indeed. If the claims cannot be met out of the £3,500,000, what proportion of them is to be met, and on what basis? That question, in its turn, depends to a very large extent upon the length of time that the Government propose to pay the interest on these bonds, and on the rate of interest which they propose to pay. It is fantastic to suppose that on bonds of this kind the British Government are to go on paying, for an indefinite period, rates of 6 per cent., 7½ per cent. or 8 per cent., when they are paying only 2 per cent on their own bonds. We have the right to know something of the intentions of the Government in this matter. Do the Government propose to fund these bonds; and, if so, on what basis? If not, for how long do they propose to pay interest? And at what rate?

Another point which I wish to put is in regard to the Austrian loan. I do not know why it should be included in this scheme. The Czechs were not responsible for the seizure of Austria. They did not want it, and they would not have approved of it if they had been asked. I do not know why they should be expected to service this loan. [An HON. MEMBER: "They guaranteed it.") Yes, but other people also guaranteed it. It seems to me that we are taking the Austrian loan as it were from outside and putting it into a scheme dealing with purely Czech assets, without much logic, reason or purpose. I agree that the old Government of Czecho-Slovakia guaranteed it, but other Governments also guaranteed it. The Austrian loan may well be susceptible to an international solution eventually, in which, no doubt, the old Government of Czecho-Slovakia and the new Government will play their part. But I do not see why these assets should be subjected to these provisions. I believe the amount involved is very small, but I should like to know, at some stage, the reasons which have led the Government to take this step.

On page 3 of the scheme, in paragraph 1 (c) there occur the words: shown to the satisfaction of the Treasury to be beneficially owned by a British holder and to have been so owned by him at all times since the 14th March, 1939. Here is a point of considerable importance which I would like to put to my right hon. Friend; I do not know if he can answer it to-day, but it is a point which deserves careful consideration. Does that mean that if a claim has been assigned, for instance to a bank as security for a loan, the claimant loses his rights? I am sure that in some cases, where some of these smaller holders of assets have been hard pressed, they have assigned their claims as security for loans; and I am equally sure that the Government would not wish that because they have done this they should forfeit their rights under the scheme. I feel that if these words are open to that interpretation, my right hon. and gallant Friend would take steps to put it right.

Then there is the important point of what constitutes a British holder. I am going to submit that all cash claims should be met. We have plenty of money to do it. In the meantime under paragraph 2 (c) on page 4 of the Scheme, tile Treasury are seeking in some respects rather arbitrary powers. They are practically seeking the right to pay just as much to individual claimants as they think fit. Of course, in these days the Treasury must be granted enormous powers, but I want to know whether a British company which has been carrying on business in Czecho-Slovakia for years and has done a lot of business in that country will rank absolutely pari passu with a refugee Czech, who only arrived in this country on the 1st September last, when it comes to making payments in respect of their cash claims. If there is to be a system of "proportional payments" beyond a basic figure of £1,000—which I agree is right, because all claims of less than £1,000 should be met in full—then surely purely British concerns or individuals who have lived and worked in this country for 20 or 30 years. should take precedence over refugees who have come over since last summer, and who have not even begun to pay any taxes in this country. Some differentiation should surely be made between these two different classes of claimants. Then there is a phrase in paragraph 1 (c) on page 3: …who was resident in the United Kingdom or … carrying on business in the United Kingdom … and is so resident or carrying on business on the date on which the relative claim is made by him. What is the relative claim? I agree the claims of those who have left this country since 3rd September, or who now desire to leave this country, should not be met; but I imagine—and this is a point to which I desire particularly to draw the attention of my right hon. and gallant Friend—that this would not apply to resident Czechs in this country who are now on war service in France in one form or another. I presume they will not be considered as having left this country for the purposes of the scheme, but that they will be regarded as being resident in this country.

There is one other point with regard to Czech holders which I would like to put to my right hon. and gallant Friend; I think it is a point of some importance. Certain Czechs came over to this country shortly before the outbreak of war and declared that they were not residents in this country, but were simply living here for a short period for the purpose of going to the United States of America. They therefore did not surrender their dollar holdings. In quite a number of cases I think these Czechs, who came over here and who are comparatively wealthy, have been unable to obtain visas hitherto for the United States. Surely these gentlemen ought not to be entitled to payment as British holders in respect of cash claims, and thus receive not only their sterling claims, but also be allowed to retain their dollar holdings? If they have opted to go to the United States of America as a permanency, and make that their place of residence in the future; and if they have refused to surrender their dollar holdings on that account, then merely because they have been unable to get to the United States on account of transport or visa difficulties, and therefore under this scheme may qualify as British holders, they should not be compensated in full for their claims in sterling, and also be allowed to retain their dollar holdings, subsequently leaving for the United States having got the advantages of both situations. I think that is a point of substance to which my right hon. and gallant Friend should direct his attention. There is another phrase in paragraph I (c) of the scheme: The expression 'registered obligation' means an obligation in respect of which a claim has prior to the 31st January, 1940, been registered with the Bank of England in accordance with the notice published by it on the 3rd April, 1939. I presume this means that anyone may still make a claim up to the 31st of this month. I would point out that a good many opportunities have already been given to holders of claims to lodge them. They were told to push them in by April last, and then they had a further extension, and here they are getting a third. I venture to hope there will not be any further extension beyond this, because a very large number of these holders are now much less interested in lodging their claims than they are in getting some kind of payment. The claims have been lodged over and over again, and the date has been postponed on at least two occasions. The question in which they are interested is when they are going to see the money which is due to them. Therefore, I would like some assurance that this further extension of the time in which claims can be registered, in view of the fact that it has been twice extended, does not mean there will be further delay on the part of the Treasury in getting down to business.

There is one Section of the scheme of which I wholeheartedly approve, and that is Section 3 on page 4. It says: … in relation to beneficial ownership owing to such beneficial ownership being vested in several persons, the Treasury may allow such payment to be made as they consider equitable having regard to all the circumstances of the case. These claims should be made by, and paid to, British holders; and if a British claimant is also claiming on behalf of other claimants, whether in CzechoSlovakia or in other parts of the world, it seems equitable that the Treasury should take into account the proportion of the claim which belongs to him personally, and then pay that amount only. It would certainly not be right for one holder living in this country, and putting in a claim on behalf of other holders either in Czecho-Slovakia or elsewhere as well, to be paid in full.

Finally, so far as paragraph 5 is concerned, while "arrogant" may be too strong a word, the Treasury is certainly asking for very drastic powers--in my view, too drastic. Listen to this: The Treasury will retain full power to decide all questions arising in regard to the scheme and any decisions given by or on behalf of the Treasury shall be final. They say also that they may refuse any payment if they think it can be obtained from another source. And lastly: the Treasury may also, so far as the total funds available may permit, provide for further payments. Here I think the poor faithful patient House of Commons is certainly entitled to ask the Treasury whether they think any further payments will be made, and on what sort of scale, and when. And here I come back to what I said at the beginning. At the moment we have been vouchsafed too little information about the intentions of the Treasury and the amount of the cash claims to form an honest opinion as to whether the scheme is intrinsically fair or unfair, good or bad.

Strong arguments can be adduced in favour of meeting all the cash claims in full at once. There are sufficient funds blocked in the City of London available for this purpose. The validity of the cash claims was admitted before the war, as my right hon. Friend the Chancellor of the Exchequer knows, even by the German Government. We cannot tell what the future holds in store, but we can be quite sure that one day a liberated Bohemia will take her place in what I hope will be a federation of free States in Central Europe. We can, however, be equally sure that Central Europe will never return to the political and economic Bedlam which was created in 1919. When we talk of restoring Czecho-Slovakia in precisely the same economic and political form in which she was before, I hope and believe that will never come about.

When the time comes—alas, it is not yet in sight—the necessary financial assistance will also have to be found by this country and other countries, perhaps also by a country across the Atlantic Ocean, for the nations that will form the new Europe—the Europe which ought to have been created in 'gig, and which, alas, was not. Meanwhile, in order to free these countries, including Bohemia, from the Nazi yoke, we want all the money we can get in this country, and we want to put it to the best possible productive use here at home, and now.

The question I want to put to my right hon. and gallant Friend this afternoon is whether he thinks it right to keep a large sum—perhaps £14,000,000 or £15,000,000 —lying idle, when it could be used for productive purposes in this country? The Government have recognised the right, and indeed the necessity of meeting cash claims out of the assets now blocked in this country. If it is right, then I submit, with all due respect to my right hon. and gallant Friend that there is a very strong case to be made out in favour of paying these cash claims, so far as they can be substantiated by documentary evidence, and for paying them in full and without further delay. This is a matter upon which, I submit, the House of Commons has an undoubted right to express an opinion; and all I would suggest to my right hon. and gallant Friend this afternoon is that, before submitting this scheme in the final form of a Treasury Order which we cannot amend, he should carefully consider the arguments which may be submitted to him from both sides of the House this afternoon, that he should give full weight to them, and that he should bear them in mind when drafting the final scheme which will be submitted to us.

5.39 p.m.

Mr. Mander

As has been said this afternoon, this is a highly complicated and technical matter arising out of the unhappy history of the last 18 months. A number of points touching one side only of the problem have already been dealt with, and there are one or two other aspects of it which have not yet been referred to and which I would like to mention.

First of all, I desire to raise the point whether there has been any consultation in connection with this matter with the recently recognised Czecho-Slovakia Committee in this country. It will be remembered that there is a Czecho-Slovak Committee, which was recognised by the French Government on 17th November last, and more recently by the British Government, consisting of eight distinguished Czech subjects—Dr. Benes, General S. Ingr, M. S. Osusky, M. E. Outrata, M. H. Ripka, M. J. Slavik, Mgr. J. Shramek and General R. Viest—and that, in reply to a letter from Dr. Benes about this committee, Lord Halifax informed Dr. Benes that His Majesty's Government in the United Kingdom took note of the communication and recognised that the committee were qualified to represent the Czecho-Slovak people, particularly with regard to certain military arrangements, but not necessarily with regard to them only. It would seem to me quite proper that a measure of this kind should be discussed with such a committee. Perhaps the Minister who is going to reply would be good enough to say whether—

Captain Crookshank

In order to save further application to that point, perhaps it would be as well for me to say that the Czecho-Slovak Chargé d' Affaires has been consulted about this scheme, and that has agreed with it.

Mr. Mander

I was going to ask whether the committee had been consulted; but perhaps one goes with the other. I was going to suggest that on any other matters the same procedure might be adopted, so that this committee might have the prestige that it would obtain from being officially recognised. With regard to the financial side of this Bill, the Treasury does not seem to have been particularly generous to the claimants. It has taken no action for nine months. It is now proposed to pay an unspecified rate of interest on certain bonds for an unspecified period, to meet all the claims, but only to a limited extent. I think that the British Government ought not to be paying interest, if they are responsible for it, at the rate of 6 per cent., 7½ per cent. or 8 per cent.; that is far too high. The view, I suppose, is taken that this is only to cover a temporary period. The question has been raised as to how long the period will be during which payment of interest can be kept up. I understand, from certain calculations that have been made, that it would last for about 10 years; and I should like to know whether that is correct.

I assume that the reason why the Government are using the money by way of interest, instead of repayment of capital, is that they hope that in less than 10 years there will have been set up a free Czecho-Slovakian State which will be able to take responsibility for its own affairs once more. I think we ought to be informed how many of these bonds are held to-day by British holders, and precisely what are the intentions with regard to the future payments of interest. Under the proposed scheme, as has already been pointed out, the actual Czech assets blocked in this country, amounting to £17,000,000, are not going to be touched at all. It is proposed to use only the unexpended balance of the loan made to the Czecho-Slovak Government after Munich. I think we ought to have some definite assurance with regard to the Government's intentions about these blocked assets over here. I hope they are going to be used at some future date for the citizens of Czecho-Slovakia itself, that the money is not being kept back for the purpose of any bargaining with the German Government as a result of which some portion may go to Germany. I am sure that that is so; but certain suspicions are abroad, and it would be a useful thing for them to be destroyed once for all by the Chancellor of the Exchequer, so that there can be no room left for misunderstanding.

I agree that strong arguments can be adduced in favour of meeting all the claims of British holders. So far as cash claims are concerned, there is no question that they ought to be met in full, and at once. No indication is given as to when the Treasury proposes to repay the balance of these claims. Under Clause 4, no statement need be given to the House of Commons until 30th November next. I think we ought get some statement from the Government long before that date as to what they propose to do; otherwise, the Treasury will have power to do anything they like without accounting to the House of Commons. We ought to have information with regard to these points: the amount of the bonds held by British holders, the manner in which it is proposed to deal with the interest payments, the probable amount of cash payments, and the amount which will be available. I hope we can have the assurance that such claims as can be substantiated will be met in full, and very quickly. There is one point in connection with paragraph 6 of the scheme. There, it is stated that For the purpose of this scheme, CzechoSlovakia shall not include Sudetenland. I quite understand how that arose: it was a post-Munich arrangement. But it seems to me, in view of all that has happened since, very unfair that some Czech subjects who might have been living in that area at the time, or some Sudeten Germans whose only crime was that they were democrats and loyal to the State of which they were citizens, should be deprived of all opportunities of benefiting under this Bill. I should like the Government to consider, before they finally settle the terms of this scheme, whether that paragraph ought not, in the light of things as they are now, to come out altogether.

I should like to say a word with regard to the funds which it is proposed to spend on refugees. A considerable amount is available there. Of course, the problem is entirely different from what it was before the war broke out. Originally, the problem was to emigrate as many Czechs as possible, whether from Bohemia or Moravia or from this country, on permanent settlement schemes abroad. Such a scheme was partly carried out, with success, in Palestine, and another scheme was fully carried out in Canada. The war has changed all that. Obviously, emigration from this country is extremely difficult, and it is practically impossible for any Czechs to get out from their own country. It may well be that Czechs living over here now who, until recently, contemplated with satisfaction settlement abroad, are now looking forward to a time when they can go back to their old country and take up the life which was stopped so suddenly not long ago. It may be that as unemployment decreases in this country and there is a demand for the high qualities of many of these Czech subjects as craftsmen, workers in industry, or soldiers, they will be taken up into employment. Therefore it would seem that this fund will be used, to a considerable extent, for maintenance during such a transitional period. If the transitional period of maintenance were to be of any prolonged duration the strain on the finances of the fund would be very grave indeed; and I sincerely hope that that problem will not actually arise.

I do not think that in dealing with this Bill one can possibly overlook the situation which would have existed if the Treasury had been a little more alive and if the two British directors of the Bank for International Settlements, Mr. Montagu Norman and Sir Otto Niemeyer, had more effectively carried out their duties, and prevented £6,000,000 of Czech gold being transferred to Germany in March of last year. This Bill would have been quite a different Measure then. I hope that that will not occur again. It was not only £6,000,000; a further £1,000,000 of Czech gold was paid over to Germany in August last by the Bank for International Settlements. I understand that the accounts are now so altered as to make it impossible to identify as easily as was the case before what is taking place. In speaking of that, I am speaking of a deplorable event in the past.

There is something that I think might still be done in the way of securing financial support by putting forward our claims, although, I must say, I do not put my hopes too high. The Treasury has a trust deposit account with the Bank for International Settlements. Although these deposits are invested in Germany, the responsibility for repayment is with the Bank for International Settlements, by virtue of The Hague Agreement of 1930 and the Brussels Protocol of 1936. The German Government have actually undertaken that they will not place any restrictions upon the transfer of assets of this kind, even in time of war. I think that, to help us in a Measure of this kind, the Treasury ought to insist to the utmost of its power—which it has not done up to now—on repayment, and that the Bank for International Settlements should insist on the release of the fund by the German Government. It may be that the German Government would repudiate this agreement, as they have repudiated others, but we surely ought to press our claims to the utmost, to do all we can to get the money. If they are shown once more as breakers of oaths, well, so be it. I imagine that one of the effects might be the insolvency of the Bank for International Settlements itself. I do not know that that would be such a deplorable event.

This Measure is really only an attempt to bridge over a period of the war. We all look forward to the time—I am afraid it is not coming very soon, but we hope it will not be too distant—when that splendid democratic State of CzechoSlovakia will arise once more, in some form, and take its rightful place among the nations of the world. From all we have known and seen of them in the past, we know that they will, as ever, be in the forefront of the peoples of the world in the sphere of civilisation and culture.

5.45 p.m.

Lieut.-Colonel Sir A. Lambert Ward

I share the surprise which has been expressed by practically every Member who has spoken at the smallness of the amount dealt with by this proposed legislation. It is really only the balance of sums which we ourselves have given or lent to CzechoSlovakia. There is still this very large sum of blocked assets, which has not keen touched at all. In reply to Questions in this House, it has been stated that these blocked assets total from £16,000,000 to £17,000,000 or £17,500,000. They consist of bank balances in this country, owned by Czechs who succeeded in escaping from Czecho-Slovakia. They consisted of bank balances in this country owned by the Czechs, and there was a large sum in gold which had been deposited by the Bank of Czecho-Slovakia in the Bank of England. We also heard from the Chancellor of the Exchequer that it was the intention to use these balances to satisfy those who had claims on the Government of Czecho-Slovakia. Let us see just how that is being carried out. The hon. Gentleman the Member for East Wolverhampton (Mr. Mander) said that he understood, as the result of calculations, that the funds in hand would be sufficient to meet the interest upon those loans for eight or ten years, but my information is totally different. It is to the effect that the funds available will not meet the interest on the loans for more than a couple of years at the very most. In addition the financial claims are not being met in their entirety at all, but only in part, the argument being that funds are not available. There is only a sum of £3,500,000 available for meeting these claims.

I think everybody agrees that the first claims on the fund are those of refugees in this country and claims for money which should be used, if these people choose to remain here or to migrate still further, in the direction of giving them a chance of earning their livelihood in the country of their adoption. When those claims have been reasonably satisfied the claims of British holders or holders of British balances should come next. I cannot for the life of me see the reason why this £7,000,000 gold deposit in the Bank of England, should, if necessary, not be used for that purpose. I have always understood that that money has been deposited here towards meeting the services of the various loans which had been floated in this country. That was the reason why those loans always stood so high in the market. The loans which are dealt with here, and the Skoda debentures have always stood at or above their par value, and, as far as I can see, there is not the least reason why, if necessary, these funds should not be brought into this account to meet these claims.

The Austrian 4½ per cent. loan has been mentioned once or twice. The position, as I understand it, is that the Government of Czecho-Slovakia have guaranteed, as have the Government of this country, the Government of France and of one or two other countries, 24½ per cent. of that loan—not 24½ per cent. of the loan raised or held in this country, but 24½ per cent. of the total amount. That is the liability of this country, of France and of Czecho-Slovakia. If these guarantees are implemented it will mean that interest will have to be paid no matter where those bonds are held or wherever they were issued. In the circumstances, being at war with Germany, we can refuse to pay any interest to German holders.

There is another situation which has arisen. The Government of Italy and the Government of Holland have both declined to implement their guarantee and have advanced a curious reason for doing so. It is that, as they are still receiving money from Germany, they are not in any way interested. Should Germany cease to pay the necessary money to Holland and to Italy to enable them to pay the interest on bonds held there, we should not in any circumstances whatever allow any of the money contributed by the British Government to be used for meeting the claims of bondholders in Italy or in Holland. If they have refused to implement their guarantee, as far as we are concerned, then we are entitled to refuse to implement our guarantee as far as they are concerned. I hope that the right hon. Gentleman, or the Financial Secretary or whoever may be replying, can give us some information as to what funds are likely to be available, and the claims which these funds will have to meet, and also the reason why this large amount of gold deposit in the Bank of England cannot be brought into account for the purpose of satisfying these claims.

5.51 p.m.

Mr. Edmund Harvey

I think that the whole House is indebted to the Financial Secretary for the clarity with which he has explained an extremely complicated Measure, and we are also indebted to the Government for having produced this White Paper, which throws further light on the details of the way in which one section of this Bill is to be worked by the Government. I want to ask the Financial Secretary whether he could take steps to provide a similar White Paper to deal with the Clause relating to the gift which is being expended for the benefit of refugees. There is a further reason for that. There is a good deal of uncertainty as to the way in which the money already spent on behalf of these refugees has been administered. It would be of great interest to the public, and especially to those who are interested in refugees, if they could know the way in which the gift already advanced has been expended for the benefit of Czech refugees, and also be a great help to know the broad lines of the plans that are proposed by the Trust for administering the larger sum which will shortly be made available to them by the wise action of the Government for the benefit of the Czech refugees. Is it possible for the Government 10 make it clear that they are going to put the widest construction upon the terms "Czech refugee"? It has already been pointed out how important it is that they should include those from the Sudetenland as well as from Czecho-Slovakia in its narrower connotation. It is also important to make it possible, if, in the not too distant future, happy events should facilitate the return of refugees to a free Czecho-Slovakia, for money to be made available for that purpose and not merely for settling them overseas, which is the original intention of the main purpose of the fund.

I want to raise on behalf of my colleague, who is unable to be present to-day, for a reason that we all respect and deplore, one special point in connection with this question of Czech refugees. There are a considerable number of refugees now in this country from Czecho-Slovakia, but in many cases the wives or husbands or children, as the case may be, are still, unhappily, in that territory and unable to reach this country. Could not use be made of that fund in order to make it possible for such divided families to be reunited by the absent member passing through a neutral country? There are well substantiated cases where a neutral country could give a transit visa, but they will only give it if they have at least an informal assurance that the refugee will be allowed to enter this country, and it is not at present possible to do that. It is quite possible that a wide door could be opened of which unsatisfactory use might be made by those who are now in control of CzechoSlovakia, but I am assuming that proper precautions would be taken. In these cases, I hope that this fund may be made available for the reuniting of refugees who are now, unhappily, separated as a result of the war. I hope that the Government may make the position clear by issuing a White Paper dealing with matters to which the right hon. Gentleman probably will hardly be able to reply on the spur of the moment at the conclusion of this Debate.

5.57 p.m.

Major Procter

I am sure that all the Czech refugees are extremely thankful to the British Government for making it possible for them to recover something of their fortunes which they have lost through German aggression, but I do not really think that many British people understand the wise and generous provisions which have been made to implement Britain's word. It is an astounding thing, yet it is worthy of our highest traditions that men and women have found asylum here and have been given freedom and the right to live a well ordered life, that the Government of the country which has given them protection have acted as a debt collector and saved from the hands of the aggressor huge sums of money, which they have given to the refugees in this country.

This is an enabling Bill, which can only be understood by reference to the White Paper, and it makes the position of the refugees in this country better than that of the Czecho-Slovakians themselves who are resident in their own country. I do not think that that is understood or that credit has been given for the provision in this Bill that makes that possible. Any Czecho-Slovakian who had a bank balance, especially if he was of Jewish origin, would, if he had remained in Czecho-Slovakia, have lost all his money. No Czecho-Slovakian who is resident in Holland or in France or even in the United States of America has got such a deal as that which the British Government have given him by means of this Bill. I am certain that these patriotic men —and I have spoken to many of them—are not only grateful but surprised that they have recovered anything at all, and it is because of that that I regret that the British Government have not used this opportunity of helping Czecho-Slovakia, the refugees and themselves on an equitable basis. What is proposed here is to pay out to the refugee in hard cash half his claim. The British Government is in fact acting as a debt collector on behalf of the refugees here. I do not think for one moment that any Czech refugee would have objected if the British Government instead of giving them their money in cash had given it to them in British War Loan. I suggest that if there is another half to be paid, it should be given in the form of War Loan. All the guaranteed loans mentioned in the White Paper should be converted into British stock or at least the interest payable should not exceed the British War Loan interest rate. If this money is paid out in sterling—and I am not suggesting that the first instalment should not be so paid out—arrangements could have been made with the Czech Committee that the Czech Legion, which it is hoped to establish here, should receive part of this money to equip itself for the fight for the restoration of liberty to Bohemia. There is a splendid opportunity now for getting £1,500,000 to £2,000,000 into the British Treasury which could have been shared with the Czech Committee to help equip Czech soldiers and to finance its propaganda.

Having said that on the general questions of the Bill, I propose to call attention to page 3 of the White Paper beginning with the word "shown." Under the scheme set out in the White Paper a new status is given to the Czecho-Slovakian or other claimants—the status known as "British holder." As I understand it a British holder may be of any nationality, but if he be of Czech or any other nationality there are three important dates which determine his claim. The first condition is that he has a claim for an amount owned by him at all times from 14th March, 1939, to 3rd September, 1939, the holder must be resident in this country on 3rd September and that he must be also resident, after he has put in his relevant claim, until 31st January, 1940. What I would like to know is this: What is the position of a man who was the beneficial owner of the claim on 14th March but who between that date and 3rd September may have made an assignment of his claim to another British holder? According to the precise meaning of this paragraph it would appear that neither has any claim whatever. Is this paragraph designed to secure continuity of holding in the claim? It may be that the Treasury has a valid reason. It may wish to prevent any exploitation of the refugees. I can understand that condition being made now, but there may have been an assignment without any exploitation. The refugee may have assigned his claim to a bank in order that he may get sufficient money on which to live. According to this White Paper it would appear as if both the Czech refugee and the person to whom the claim has been assigned cannot make a claim at all because there has not been continuity of holding.

There arises another position—that of a man who may have been a beneficial holder on 14th March and may have been resident here on the 3rd September, but who may have decided to join the Czech Legion on the outbreak of war and at this moment be in France. Unless he can come back here by 31st January he is out of the picture and his claim is lost. Furthermore, there may be, indeed there are, other Czechs who have been desirous of taking up occupations in this country but who have been precluded by the conditions of their permit from working here. They may have decided that they would go to some other part of the British Empire. They have put in their claim just as others have done and perhaps on the 2nd September sailed for Canada. They may have gone there merely to look round. They, too, are outside the terms of this Act if my reading of the White Paper is correct. Therefore, I ask the Minister if he will consider the rewording of this Section so that it reads as follows: For the purpose of this paragraph (I, c) the expression British holder ' means an individual who was resident in the United Kingdom or a corporation which was ordinarily carrying on business in the United Kingdom at any time between 14th March, 1939, and 3rd September, 1939. To these I would add the words: Or is either so resident or carrying on business on the date on which the relative claim is made by him or is on that date resident in a British Dominion or colony or in the Republic of France. The reason I have included France is to bring in those who were here on the 3rd September and would have been here now but for the fact that they answered the call for volunteers and therefore cannot be here. In conclusion, I would like to take the opportunity of congratulating the British Government in living up to its traditions of being a refuge for the oppressed. I congratulate the Government for giving to the refugees better and more just treatment than they have received in any other country in the world.

6.10 p.m.

Mr. Benson

Before I congratulate the Government on this Bill on the lines of the hon. and gallant Member who has just sat down, I think I should require a little more information. Frankly, the White Paper does not tell us very much. In fact it tells us very little. What I am primarily concerned about is how much is going to British individuals and companies and how much is likely to go to the Czechs. The hon. Member for Aberdeen, East (Mr. Boothby) suggested that old-established British companies should have preference over newly-arrived Czech refugees, but I would point out that this money was originally provided for the purpose of helping Czecho-Slovakia. The hon. Member and the whole House remembers what happened after the Munich affair when the Government attempted to salve its conscience by granting £10,000,000 to Czecho-Slovakia. Four million pounds has been definitely earmarked for the refugees but the other £6,000,000 is now apparently to be used partly for the Czechs in this country and partly for paying interest on Czech loans to British bondholders. That was outside the scope or the intention of the House when the original loan was agreed to by the Government. It was not granted for the purpose of indemnifying British shareholders. Yet some of the money is to be put to this use. How much I do not know. If the House had known of the ultimate end of the money I doubt whether there would have been so much enthusiasm as there was at the time.

The real question is whether we can afford under the original motives to grant this money for the purpose of paying bondholders their interest and for taking up Czech Treasury bills and bonds that have matured. I am concerned that the £4,000,000 allocated to refugees has already sunk to £2,900,000. How long will it be before the £4,000,000 is used up entirely? The hon. Member for the English Universities (Mr. Harvey) suggested a number of methods by which the Czechs could be helped in addition to the help already given. If they should be carried out, the residue of the £4,000,000 will dwindle even more rapidly. I think we ought to know more definitely how much of the £3,500,000 loan money is to go to the people to whom we originally intended it should go, and how much is going into the hands of British bondholders. It is not the concern of this House to compensate British holders when their loans go wrong, certainly not out of funds which are allocated for the benefit of Czecho-Slovakians. We cannot get any idea whether it is really a case of misfeasance or whether we have The money available to help the bondholders until the Treasury have provided us with the information we ought to have of the various sums allocated and the amounts; and whether there will be adequate funds left to deal with the Czech refugees.

Mr. Boothby

May I put this point to the lion. Member? I agree with him that we are not greatly concerned with the bondholders, and I think the Government should sharply restrict the period and rate of interest which is paid. My point was only with regard to the cash claims. There is enough money to meet them. My point was not to meet the interests of British bondholders, but to see that the cash payments are made, because I know there is enough money available to pay them.

Mr. Benson

I agree that the blocked Czecho-Slovakian assets may well be set against the English claims, but we are not dealing with them in this Bill. It deals entirely with money which comes from the British Treasury, with money derived from the British taxpayer, which was granted for a specific purpose. Under the Bill it is now to be deflected from the purpose for which it was originally granted.

6.18 p.m.

Captain Crookshank

I propose to say only a few words in reply to the Debate. The House is to have a Debate on the black-out immediately, but I hope the House will not think the black-out has been anticipated in the discussion on this very technical and difficult question. At the same time, I am grateful to hon. Members for the way in which they have received the Bill. I appreciate the courtesy with which hon. Members have received the White Paper; that is the scheme as we envisage it. We shall, of course, consider the various arguments which have been put forward with regard to one paragraph or another. What is the good of having a House of Commons unless we are going to weigh up the considerations which have been put before us in a Debate like this? There are certain questions which I may perhaps answer beginning with one by the right hon. Member for Edinburgh, East (Mr. Pethick-Lawrence) who asked what were the intentions of the Government with regard to the remaining blocked funds which are not covered by the Bill. Various hon. Members have asked how much they are. The amount, I think, is about £10,000,000 sterling. These assets are blocked to-day, and it is the intention to leave them blocked until the end of the war. The right hon. Gentleman opposite, so it seemed to me, thought that was the right thing to do, but an hon. Member below the Gangway wanted these blocked assets to be used by the existing Czech National Committee. Whatever views hon. Members may hold about the matter, our intention is that they should remain blocked until the end of the war, and that we cannot in fairness to all parties decide on their disposal during the war. That must be part of the arrangements which will be made at the conclusion of hostilities and, therefore, in circumstances which none of us can foresee.

Mr. Mander

Can the Financial Secretary give an assurance that it is not intended that this money should in any circumstances go to Germany, but should inure wholly for the benefit of the CzechoSlovakian Government and their subjects?

Captain Crookshank

I cannot imagine why this money should go to Germany in any circumstances, but I am talking about what is to happen in the immediate future, and our view is that these assets must remain blocked until the end of the war. The right hon. Gentleman also asked why there was no reference to categories (b) and (d)—financial obligations which were registered in accordance with the Bank of England circular on 3rd April last. It is true that paragraphs (b) and (d) have now disappeared from the picture. The reason is that a great deal of water has flowed down the Thames since 3rd April, and the circumstances now are not what they were on 3rd April. I do not want to go into details, but if hon. Members are interested they should look up a reply given by the Chancellor of the Exchequer to the hon. Member for Willesden, East (Mr. Hammersley) on 13th July in which he said that after the Recess he hoped to submit a scheme to the House and referred to the difficult problems which were concerned in this matter. He also stated that he would take up the matter with the German Government. But things have happened since then which make it impossible that there should be discussions with the German Government and, therefore, these particular categories are not dealt with here. The right hon. Gentleman made a specific point about cooperative accounts. I think I can say this to him. We are not quite sure that these accounts are of such a type as could be easily verified. If they could be brought within the scheme we should be glad to consider doing so.

Another point which I should like to answer in the right hon. Gentleman's speech was how much the claims amount to. Until they have been examined no one can possibly say. The hon. Member for Aberdeen, East (Mr. Boothby) expressed the fear that the extension of the time-limit for the registration of claims would involve further delay in making payment on them. This extension is only until the 31st of this month, and so could hardly cause any delay. There is no intention of altering the time-limit and that is why I went out of my way to give a timely warning in my speech on that matter. The question put by the hon. and gallant Member for Accrington (Major Procter) as regards assignments is a legal matter which I should like to consider with my legal advisers. The hon. Member for the English Universities (Mr. Harvey) asked a question with regard to the Trust Fund. I wonder whether he has overlooked the fact that a White Paper, Cmd. Paper 6076, was circulated in July setting out the Trust Deed with a letter of direction to the trustees from the Secretary of State for the Home Department.

Mr. Harvey

I had not forgotten that, but circumstances have so altered since that date and the whole position is so completely different that it may well be desirable to reconsider the question of these trust funds.

Captain Crookshank

That is perhaps a matter which I think the hon. Member can best elucidate by question and answer, but the trust still continues and the money is paid to these trustees under this Bill. I do not know whether he was putting his question on behalf of his colleague the hon. Member for the English Universities (Miss Rathbone), but if so, it is a fact that the advisory council includes the name of the hon. Lady as one of its members, so that she at any rate can keep in touch with the day to day development of the matter.

Until we have the final claims all brought in and an examination made, it is impossible to make any estimate of the amount. The question which has been raised several times is that of the various obligations in the White Paper and the rates of interest. The answer to that is that by the scheme, if it commends itself to Parliament, we are not stepping into the shoes of the debtor country for all purposes, but that only for a certain period, which is not determined, we propose to pay interest on a selected part of these obligations. We are not in a position to make any alteration by way of funding the loan; what we are doing is to step into the shoes of the CzechoSlovakian Government for the purposes only of payment, as governed by the White Paper. There are plenty of people who are holders of these funds who are not living in this country. There is nothing we can do—

Mr. Boothby

Except limit the period.

Captain Crookshank

There is no predetermined period because we have to wait and see what the claims are, what categories we can pay out, and also the validity of the documents we get. Obviously, it is unsatisfactory that the matter should be as fluid as that, but it is necessary. I can only end by expressing my thanks to hon. Members for the criticisms and comments they have made and to assure them that my right hon. Friend. the Chancellor of the Exchequer and myself will certainly go carefully into them, and if we feel that the Order in its present form can be altered usefully in any respect as a result of this discussion, we shall of course do so. I think this arrangement will be satisfactory to the House as a whole.

Question, "That the Bill be now read a Second time," put, and agreed to.

Bill read a Second time.

Motion made, and Question, "That the Bill be committed to a Committee of the whole House for To-morrow, put, and agreed to.—[Lieut.-Colonel C. Kerr.]