HC Deb 28 July 1919 vol 118 cc1814-5
61. Lieut.-Commander KENWORTHY

asked the Prime Minister what steps it is proposed to take to deflate the currency in view of the adverse effect the present in flation of the currency is having on trade, industry, and conditions of life in this country; and, it the Government have no settled policy with regard to this matter, will he consider setting up a Select Committee to deal with the question and advise the Government on it?

Mr. BALDWIN

The Government fully recognise the necessity for checking the further expansion, and bringing about a gradual contraction, in the currency note issue, and a beginning has already been made in this direction by means of the recent Funding Loan, as is shown by the currency note returns for the last two weeks. My right hon. Friend anticipates that the effect of the Loan and of the policy which he proposes to follow in regard to the remainder of the floating debt will result in further and substantial progress in the same direction in the near future. He docs not think there would be any advantage in the appointment of a Select committe The principles on which the matter must be dealt with are. I think, generally understood and agreed, and the questions for decision are how and when and to what extent the necessary measures should be applied, regard being had to the conditions of credit, trade, and industry, from time to time. The responsibility for deciding on the action to be taken from day to day must necessarily rest with the Government.

Lord ROBERT CECIL

Will the hon. Gentleman convey to the Chancellor of the Exchequer the information that there is a considerable difference of opinion amongst experts as to what bearing the increase in the currency has upon the in crease of prices and other topics of that kind? Does he not think an inquiry by a highly skilled small Commission would be desirable to ascertain the, real facts of the case?

Mr. BALDWIN

I will certainly represent my Noble Friend's view to my right hon. Friend, but I would remind the Noble Lord that there are differences of opinion amongst experts.