§ 39. Mr. REMERasked the Prime Minister whether transferring the liability of the British Cellulose Company from debentures to preference shares materially depreciates the security held by the British Government; and whether, in view of the general disquiet, he will grant facilities for debate?
The CHANCELLOR of the EX CHEQUER (Mr. Chamberlain)No, Sir, in the opinion of the Government it does not. The arrangement made is, in the opinion of His Majesty's Government, that best calculated to protect the money previously lent by them to the Company, and to preserve to this country an industry of vital importance in war and of great utility in peace. As regards the last part of the question, as stated on Thursday last, this question can be raised on the salary of the Minister of Munitions.
§ Mr. HOLMESHas the Company now the right to raise fresh debentures which will be a prior charge?
Mr. CHAMBERLAINI must have notice of that question, but I think that I am right in saying that that is not so.
Major BARNESIs the course that was followed the same course exactly as we followed in the case of the British Dye Stuffs Corporation?
§ Mr. KILEYWhat action, if any, did your Department take when the Company stated they were unable to meet their obligations to dispose of your debentures in the open market?
Mr. CHAMBERLAINThe hon. Member does not understand what happened. We had a prior charge on all the assets, and we could have forced the Company into liquidation, but we thought it undesirable in the national interests to kill an industry which was started during the War and which is of great national importance in peace time. Accordingly we agreed to transform our prior charge into preference shares carrying a higher rate of interest.
§ Mr. KILEYIs the right hon. Gentleman aware that there would not have been the slightest difficulty in getting rid of these shares?