§ VISCOUNT GREY OF FALLODONMy Lords, in continuation of the question which I asked last month, and in consequence of the answer then given by the noble Marquess the Secretary of State for Foreign Affairs, I beg to ask him if he is able to make a statement on the policy of the Government with regard to German Reparations concerning which he stated that negotiations with the Allies were proceeding.
§ THE SECRETARY OF STATE FOR FOREIGN AFFAIRS (THE MARQUESS CURZON OF KEDLESTON)My Lords, I am glad to say that I am now in a position to make the statement which I foreshadowed three days ago. On June 7 last the German Government, having considered the replies of the Allied Governments to their first Note of May 2, communicated to the latter a further Memorandum containing revised proposals For dealing with the questions of Reparations and the Ruhr. The German Memorandum appeared in the Press of June 8. Communications then passed between the Allied Governments with the object of ascertaining and elucidating their respective points of view and the French and Belgian Governments in particular exchanged opinions with His Majesty's Government on the subject. A month later, on July 12, a statement was made in both Houses of Parliament as to the position assumed by His Majesty's Government and the necessity of action was strongly emphasised in order to terminate a situation that was fraught with peril both to the peace of Europe and to the interests of all the parties concerned.
Certain propositions were submitted by His Majesty's Government as the bases of any such action and the statement ended by recommending definite steps to the Allies. His Majesty's Government held that the proposals contained in the German note of June 7 deserved to be examined and replied to and that such reply should, if possible, be an Allied 1527 reply. Further, inasmuch as the French and Belgian Governments were indisposed to take the initiative in formulating an answer, His Majesty's Government said they would themselves assume the responsibility of framing a draft reply which they would forward for the consideration of their Allies. That brings us up to the point at which the matter was left when we last discussed it in your Lordships' House.
In pursuance of this intention His Majesty's Government drew up a draft identic reply, which they forwarded on July 20, with a covering Note, to the Allied Governments of Franco, Belgium, Italy and Japan. In this draft reply they dealt with the various proposals contained in the German Memorandum of June 7. They expressed their opinion that, while nothing should be done that was inconsistent with the stipulations of the Treaty of Versailles, advantage would be derived from an examination by impartial experts, in co-operation with the Reparation Commission, into Germany's capacity for payment. As to the question of the guarantees offered by the German Government, His Majesty's Government went on to point out in the draft reply that the economic value of any such guarantees must largely depend upon factors of which the German Memorandum had made no mention, such as the stabilisation of the mark and the balancing of the German Budget; and that no guarantees could be effective unless provision were made for some form of international control of German financial administration. The draft reply ended by advising the German Government, if it desired a resumption of inquiry, to withdraw, without further delay, the ordinances and decrees which had organised and fomented the policy of passive resistance, and unequivocally to disavow the acts of violence and sabotage which had in some cases accompanied it; and it expressed the belief that such an action on the part of Germany would involve a reconsideration by the occupying Powers of the conditions of their occupation and a gradual return to the normal features of industrial life in the Ruhr.
In the covering Notes with which the draft reply was sent to the Allied Governments His Majesty's Government gave fuller explanations of the views which 1528 they held on all these points, and they urged upon their Allies that inter-Allied discussions should be opened with as little delay as possible, whether by Conference or otherwise, for the purpose of elaborating a comprehensive plan of a general and final financial settlement.
The replies of the Allied Governments have now been received. The Italian Government have not so far returned a written answer, but have expressed themselves as in general agreement with the views and proposals of His Majesty's Government. The French and Belgian Governments have returned independent replies.
His Majesty's Government have devoted the most careful and anxious consideration to these replies, and, while fully conscious of the friendly language in which they are couched and of the cordial spirit by which they are Inspired, they regret not to find in them the material for sending the Allied answer to the German Note to the despatch of which they attach so much importance—indeed, the draft reply submitted by His Majesty's Government is not mentioned in the French and Belgian replies. Nor do these Notes appear to hold out any definite prospect either of an early alteration of the situation in the Ruhr, or of the commencement of the discussions about Reparations, to both of which His Majesty's Government had eagerly looked forward. It is apparent that many weeks, if not more, might easily be consumed in the preliminary interchange of opinions between the Allies on the lines that are now foreshadowed by the latter, before any effective step could be taken for terminating the present situation.
His Majesty's Government cannot too often repeat that while regarding the interests of their Allies as bound up with their own, and while shrinking, as they have done throughout, from any action that might be thought indicative of Allied disunion, they yet hold firmly the view that the problem now before all of them cannot be evaded, and that while the Allies may be occupied in exchanging views in a spirit of unabated friendliness on this or that detail of this or that proposal, the European situation, carrying with it all prospect of the Reparation payments to which the Allies are equally entitled, may sink into irretrievable ruin.
1529 In those circumstances His Majesty's Government have decided to lay before Parliament with the least possible delay the Papers which record their own views and endeavours, and they are inviting their Allies to agree to the publication of the Notes or statements on their part to which reference has been made and which are required to explain the situation as a whole. His Majesty's Government entertain the hope that the publication of these Papers may assist in determining the real dimensions of the problem with which the Allies are confronted, and may convince the world of the imperative necessity of prompt and united action to deal with it.
§ VISCOUNT GREY OF FALLODONMy Lords, the statement made by the noble Marquess is so grave that beyond emphasising its gravity I do not know that I can usefully say anything or whether much good purpose can be served by a debate. But on a statement so grave it may be very natural that your Lordships should wish to have a debate. I understand that there is a Motion already on the Paper by the noble Earl, Lord Birkenhead, and if ho is prepared to move that Motion, I assume that a debate will take place upon it. I would therefore submit for the convenience of the House that we should come to some understanding now, whether, if the noble Earl does intend to move his Motion, we should have a debate upon that, or whether we should reserve one comments on the, statement that we have heard made until we can have the Papers before us.
§ THE EARL OF BIRKENHEADMy Lords, the noble Viscount obviously does not exaggerate when he says this is a grave matter. My view, however, does not completely coincide with his on the further point, because I think that the wisdom of Parliament may contribute, by discussion, to the solution of grave matters, and it has been the habit of this country, when confronted with grave topics, to discuss them in Parliament. I therefore intend either at this stage or when I move my Motion [to move for Papers relating to the negotiations as to the Ruhr occupation] to make some general observations upon the present situation in the Ruhr, and upon the statement which the noble Marquess has just, made. Whether I make those general observations upon the question 1530 which has been asked by the noble Viscount or substantively upon my own Motion, is a matter of complete indifference to me. I am in the hands of the noble Marquess upon that point.
§ THE MARQUESS CURZON OF KEDLESTONI am in the hands of the House in the matter. The noble and learned Earl has a Motion down upon the Paper which he is quite entitled to move, and which, as I understand from what he has just said, he contemplates moving. It is clear that to some extent the House will be at a disadvantage, because it will not have the Paper upon which the whole matter turns. We hope to publish those Papers as soon as possible, but naturally we are, to a large extent, dependent in that respect upon the answers that come to the requests that we are addressing to our Allies, to permit the publication of the Papers which relate to them. Should, however, the noble Earl move his Motion, I shall, of course, be ready to answer his questions or to give such information as is in my power, although, for the reasons that I have named, the discussion will necessarily be of a truncated and imperfect character.