53. Sir F. HALLasked the Chancellor of the Exchequer whether he is aware that but for the assistance given to Baron Schröder by the Bank of England, after his naturalisation by the Government in power on the outbreak of hostilities, be would have been involved in financial embarrassment by reason of his close association with 885 German business houses affected by the War; and if he will state precisely who it was advised the Government of the day that the naturalisation of this German would be of assistance to British interests, and for what reason?
§ The CHANCELLOR of the EXCHEQUER (Mr. Bonar Law)I have no information to the effect mentioned in the first part of the question. I am informed that the naturalisation of Baron Schröder was recommended to the Government at the beginning of the War in connection with the exceptional steps which were being taken at that time to preserve the credit of the country. As this naturalisation will shortly come up for examination by a Committee, it is undesirable to discuss it.
Sir F. HALLCan the right hon. Gentleman say who advised the Government to grant this naturalisation, and whether it is not the law of the country that on the outbreak of hostilities it is against the law of the country for people of this country to deal with enemies? In these circumstances why was any exception made in this case?
§ Mr. BONAR LAWI thought I gave an answer to that. I am afraid my hon. Friend's law must be wrong, or he would not have been naturalised after the War. As regards the general point, I do not know who gave this special advice, but I am told it was given on the simple ground that at that time it was believed that this firm, being representative more or less of city interests, would, if anything happened to it, do great damage to the general credit of the country.
Sir F. HALLIs it not recognised that it is the law of the country that upon the outbreak of war you are not permitted to deal with enemy subjects?
§ Mr. PRINGLECan the right hon. Gentleman not say whether the Governor of the Bank recommended it and that he was backed up by the Chancellor of the Exchequer, who is now Prime Minister?
§ Mr. HEMMERDEIs it not a fact that this naturalisation took place at the wish of the Government and not at the wish of Baron Schroeder?
§ Mr. BONAR LAWI do not know as to that; but it is a fact, and the House will remember what the circumstances were, that there was a great fear that there 886 would be a general financial panic in the City of London. Representations were made to the Government that if this firm were allowed to go down it would damage our general credit.