§ 63. Mr. Harold Daviesasked the Chancellor of the Exchequer whether he will make a statement about his financial discussions with the Egyptian Government.
§ Mr. JayYes, Sir. Last December, in accordance with the agreement made earlier in the year, my right hon. Friend began negotiations in London with the Egyptian Minister of Foreign Affairs for a long-term settlement of the problem of Egypt's sterling balances. These discussions have been continued more recently in Cairo between Treasury officials and the Egyptian Minister of Finance. I am glad to inform the House that agreement has now been reached in principle between our two Governments.
Out of Egypt's blocked balances amounting to approximately £230 million. £150 million will be released over a period of between 10 and 13½ years. The future of the balance of £80 million, the amount of sterling which Egypt would normally expect to hold in London, will be the subject of discussion between the two 1767 Governments before the expiration of this period.
His Majesty's Government have reaffirmed that they have no intention of attempting to scale down Egypt's sterling balances unilaterally. In each of the 10 years 1951–60 inclusive, there will be a release of £10 million, Egypt having the right to draw a further £5 million per annum up to a total of £35 million, if the balance on her No. 1 Account should fall below £45 million. Should any part of the sum of £35 million remain undrawn at the end of the tenth year, it will be released to Egypt at the rate of £10 million per annum over the three years ending 1st January, 1963, with a final payment of £5 million on 1st July. 1963. if necessary.
In 1951 there will also be a special release of £14 million, against which we have undertaken to make dollars available, and an additional sterling release of £1 million. Finally, His Majesty's Government will undertake to facilitate the supply of petroleum products to Egypt against payment in sterling up to a total value of £11 million per annum in each of the ten years 1951–60.
§ Mr. ChurchillCan the Financial Secretary tell us, in a phrase, how much is the actual total we have to pay to Egypt for having protected her against the Nazi and Facist invasion, and whether this compensation in respect of petroleum is to be settled irrespective of the illegal blockade maintained by the Egyptian Government over oil cargoes going through the Suez Canal?
§ Mr. JayIn answer to the right hon. Gentleman, I think that he is under a misapprehension. This is not money which is being paid to Egypt. This is money in the ownership of Egypt which the British Government are releasing. In answer to the second part of his question, that has nothing to do with these negotiations, which were purely financial. That question should be addressed to the Foreign Secretary.
§ Mr. EdenSurely the Government will agree that it is impossible to divorce the granting of these very important facilities to Egypt and the manner in which Egypt has been treating our traffic going through the Suez Canal for some years at great personal expense to ourselves? Surely before the Government give any more 1768 concessions, or any concession, to this Egyptian Government that treats us in this way and holds up all our traffic, with a loss to the Haifa refineries——
§ Mr. ManuelThat's right—another war.
§ Mr. EdenIs it war to ask for a fair deal for British interests? If that is the basis on which the hon. Member proceeds, perhaps he will explain to the Israeli Government why the Haifa refineries cannot work today. Can we have an explanation of why our own rights were not insisted on before these concessions were made?
§ Mr. JayThis is a matter of agreement. If the right hon. Gentleman likes the word "concession," then this is an agreement in which concessions were made by both sides; but it is a financial agreement and does not concern the question put by the right hon. Gentleman.
§ Mr. EdenWill the Foreign Secretary or the Leader of the House tell us when there has ever been a financial agreement between two governments which has had no political implications; and when this country has strong claims against Egypt that have cost us millions—the treatment of our traffic through the Canal—cannot we make that a sine qua nonbefore we give them any financial facilities at all? [HON. MEMBERS: "Answer."] May I ask for an answer? I think that what I am putting is a reasonable question. We are giving facilities to the Egyptian Government in respect of these financial arrangements, when for more than a year Egypt has been treating us very roughly in respect of the Suez Canal. Is it not reasonable to ask that, before the House is requested to approve this arrangement, we should know why Egypt has not been required to treat us better?
§ Mr. JayI have already given the right hon. Gentleman what I thought was a reasonable answer. If he wishes to pursue the matter further, I think that he really must put down a Question to my right hon. Friend.
§ Mr. ChurchillHow does the Financial Secretary contend that this is Egyptian money? It is money which they claim on sterling balances and takes the form of unrequited exports from this country.
§ Mr. SpeakerColonel Crosthwaite-Eyre.
§ Mr. Churchill rose——[Interruption.]
§ Mr. SpeakerThe right hon. Gentleman takes up a lot of time.
§ Mr. ChurchillI could not see that my hon. and gallant Friend behind me was seeking to put a question. May I ask whether these sterling balances were not always, in accordance with the policy of the National Coalition Government, to be subject to off-sets made against them by claims for having defended the freedom and safety of that country during the period of the war?
§ Mr. JayYes, Sir, those claims were made by the Government in 1947; but unfortunately agreement on that point could not be reached with the Egyptian Government.
§ Mr. ChurchillYou gave in.
§ Mr. EdenThe Financial Secretary has made it plain that part of this arrangement is that Egypt is to buy oil, presumably from some source over which we have control. How can an arrangement be made that Egypt shall be supplied with oil from our sources when Egypt refuses to allow our own traffic to go through the Suez Canal? [HON. MEMBERS: "Answer."] I really must have an answer.
§ Mr. JayThe purchases of British oil that Egypt is making is surely a financial question. There has been a similar arrangement made in agreement with Egypt over the last three years.
§ Sir Richard AclandWill my hon. Friend and his right hon. Friend bear in mind that this question of the Suez Canal is causing some feeling on this side of the House, too?
§ Mr. EdenCan we have an assurance that this will not be regarded as a binding arrangement until this House has had a chance to look at it?
§ The Secretary of State for Foreign Affairs (Mr. Herbert Morrison)These Supplementaries began with a characteristically provocative one by the Leader of the Opposition, calculated to make mischief between us and a foreign country. Unfortunately, there seems to be some competition between the Leader of the Opposition and the Deputy Leader of the Opposition in this respect. This is an agreement which has been made, and if these other questions are to arise they had best be put upon the Paper.
§ Mr. EdenThe last request I made to the right hon. Gentleman was, I think, a perfectly reasonable one. I only asked the Government for an assurance that this arrangement with political implications will not be put into force without the House having an opportunity of examining it. I repeat—[Interruption.]Please let me put it myself. This is a matter to which I attach the very greatest international importance. There is an issue at stake, and I am asking the Government whether they will give us a simple assurance that before this agreement is put into force, which I repeat has grave political implications, they will enable the House to pronounce upon it. I beg the Leader of the House and the Foreign Secretary to remember that such an assurance has been given in the past scores of times by Leaders of the House and Foreign Secretaries.
§ Mr. MorrisonAs to that I will look into the matter, but I am not in a position to give an undertaking of that character straight off.
§ Mr. EdenThis has been done a number of times. Again, I must ask the right hon. Gentleman simply to say that by tomorrow an announcement will be made. This is a matter which we should not allow to pass now, because this is an agreement with a foreign country with implications for us all. We had no notice that this was going to be raised, and we did not know about it until a few minutes ago. I would ask the right hon. Gentleman to make a statement on this subject 1771 tomorrow, and that, pending that, this agreement will not be regarded as ratified or the House in any way committed. I do not think I am asking too much.
§ Mr. MorrisonI will look into the matter but I cannot—[Interruption.]I am not going to be ordered about by the Opposition. At the end of the day, Ministers are responsible to Parliament as a whole, and I am not going to be bullied and nagged by some hon. Members opposite. I will look into this point and the precedents and give them fair consideration. There are some aspects of the supplementaries on which the Government are already doing their best but when an agreement has been reached, I should not be expected forthwith to get up and say that the agreement is not going to be implemented until so and so. My hon. Friends have asked about that in connection with other matters, and the Leader of the Opposition has always supported the view that the Government have a right to make treaties and agreements and the House a right to upset them afterwards. I do not want to commit myself to the rather novel doctrine of the Deputy Leader of the Opposition at this stage, at any rate until I have looked into it. I am sorry I cannot make a statement tomorrow, because, as the right hon. Gentleman knows, I must leave for Paris tonight in connection with the Council of Europe, which I know hon. Members would not like me to miss.
§ Mr. EdenWould the Government deal with it in this way? There is no need for the Foreign Secretary to make a statement, but could we have a statement from some one on the Treasury Bench? It is important that we should not be committed to this thing. Will the Foreign Secretary tell us if a statement can be made by somebody from the Government tomorrow about this agreement with all its political implications. If we could have that it would be satisfactory, but, of course, we would hold ourselves free to debate the matter next week if we are not satisfied with the statement.
§ The Secretary of State for the Home Department (Mr. Ede)I will consult with my right hon. Friend and I will let the right hon. Gentleman know whether a statement can, in fact, be made.