PUBLIC WORKS LOANS BILL. (Hansard, 24 February 1927)

§ Colonel GRETTON
Clause 4 raises a question as to certain obligations by the Free State in the form of a fixed annuity of £600,000 for 20 years. I am not questioning the arrangement made on behalf of the British Government nor saying that it is not a businesslike one and, on the whole, one which it is not desirable to make, but before the Clause is accepted by the Committee, I would take the opportunity of asking the representative of the Treasury what the. Treasury think of the security for the payments proposed to be made in discharge of the debt. A speech was made in the House the other day—unfortunately, I only heard the end of it —taking a very optimistic view of the general condition of things in the Irish Free State, but information of another kind is disclosed by the official returns. The latest figures of revenue returns and expenditure show that there is a deficit 2014 in the public revenue. The railway receipts have fallen very heavily, and particularly in the total of goods carried and on account of the reduced traffic. There is another aspect of the case. The bank returns have progressively and steadily fallen for a number of years, and the decrease in the turnover is exceedingly marked. The banking turnover has fallen steadily and increasingly ever since the year 1922, when the Irish Free State was set up. Looking at other official returns of exports and imports, it will be seen that the trade of Ireland is unfortunately declining, and those who know the Free-State well remark, on all occasions when they come here, on the increasing amount of poverty and distress which exists there. All this is exceedingly deplorable, and to be lamented by every Englishman in this House. My right hon. Friend will probably say that the repayment is more secure than it would have been under the arrangement which it supersedes, but the general aspect of the case is of serious importance to the English Treasury, and I would respectfully ask my right hon. Friend if he can give the Committee some assurance as to what is the position as to the security for repayment of the debt.

§ Mr. A. V. ALEXANDER
It is rather a pity that, arising out of the controversy with Ireland, in regard to which we came to a settlement some years ago, the right hon. and gallant Member for Burton (Colonel Gretton) does not seem to learn very much as the years go by. We have debated this case again and again in the House, and most of us thought we had come to a decision when we should no longer have these matters raised in an acrimonious way.

§ Colonel GRETTON
I must protest. I have not said one word that could be called acrimonious. On the contrary, I said I deplored the position.

§ Mr. ALEXANDER
Nobody who listened to the speech or who examines the OFFICIAL REPOET to-morrow will fail to take this point, that the right hon. and gallant Gentleman has made reference to the economic position of the Irish Free State as being worse than it ought to be since it became a Free State, and that opinion, expressed by a right hon. and gallant Gentleman who held the position which he occupied in the controversy, will be taken on that basis by the 2015 public when it is published. It seems to us on this side, at any rate, to be a matter of very great regret that the occasion of making a stabilising arrangement, as I take this to be, between the Treasury and the Irish Free State should be used for that purpose. The right hon. Gentleman referred to the decrease in railway receipts in the Irish Free State, but I wonder what he thinks of the reports of a decrease in the railway receipts in this country.

§ Colonel GRETTON
There was no coal strike in Ireland.

§ Mr. ALEXANDER
Surely the volume of traffic moved in the Irish Free State has been affected to some extent by the position in this country, and the whole position in regard to trade ought to be dealt with from the point of view of Great Britain and the Irish Free State as a whole. The same thing might be applied to his remarks concerning the alleged poverty of the people in the Irish Free State. The right hon. Gentleman said he did not desire to give private information to the Committee. He may have private information which is not available to us, but, at any rate, we do not need private information to understand what is the poverty of the people in this country, as a result of the carrying out of the very policy which the right hon. and gallant Gentleman has upheld in supporting the Government here. I should not have said these things to-night if the right hon. and gallant Gentleman had not made the point. As a matter of fact, the only question which really arises on this Clause is this: Is it wise for the British Treasury at this stage to make an arrangement with the Irish Free State which will be of advantage to the Treasury, because it eliminates the risk to this country of fluctuating expenses in connection with the debt?
If that is the point to be settled, surely it is very unworthy to raise political and controversial issues on such a question as that. I have asked at a previous stage of the Bill—and I am sure the Financial Secretary did not resent the question—that it would be of great value and interest if we could have had something more detailed than the general assurance he gave us that the settlement to be made was a favourable settlement 2016 to the Treasury. If we could have had a statement, say, as to what would he the actual saving which he estimated to the British Treasury, it would have been assuring to the House generally. While we desire to be assured on that matter, we do not forget the Debates in the House in the last few years in which we have drawn attention to the very favourable settlement made by the Members of the House at the expense of the British taxpayer in favour of Northern Ireland. We do not forget that, and because we have asked questions about the settlement made in the past with regard to Northern Ireland, we think it only fair to ask the same question with regard to the settlement with the Irish Free State, to make sure that the interest of the British taxpayer is being safeguarded.

§ The FINANCIAL SECRETARY to the TREASURY (Mr. Ronald McNeill)
I confess it occurred to me that the reproof administered by the hon. Gentleman to my right hon. and gallant Friend was entirely out of place. I am bound to say that, as far as I have been able to judge, if any acrimony has been introduced into the Debate to-night, it is not by my right hon. Friend, but by the hon. Gentleman. I think my right hon. Friend, or any Member of this House, when we are discussing financial arrangements between the Free State and ourselves, is perfectly entitled to call attention to any matter bearing upon the economic and financial position of the country with which we are in intimate relation. My right hon. Friend asks whether the Treasury think that the payments which we have arranged to receive are reasonably secure. I am quite aware of the financial difficulties with which the Free State has to contend, and I sympathise with the Government and country which have to contend with those difficulties. We have our own financial difficulties, and we are not, perhaps, in a position that we can throw stones at anybody else.
The short answer which I will give to my right hon. Friend is that this is the compounding of a debt. Whatever the difficulties the Irish Free State may have in meeting their obligations to us, I am sure they will meet them honestly and honourably if they can, and I think they will be able to do so without any danger of default. But if any hon. Member has 2017 any doubts on that point, let him reflect that if we had not made these arrangements, if we had not funded the debt, there would still have been a continuing liability from the Irish Free State to ourselves, extending over a very much longer period than under this arrangement, and if there are difficulties under this arrangement, the difficulties in the other case would have been probably greater. The hon. Gentleman opposite also suggested there might be some difficulty in obtaining these payments from the Irish Free State, and I understood him to ask me some question with regard to the financial stability of that Government and country.

§ Mr. ALEXANDER
The only question I put was whether he could give, us something more in detail, in view of the assurance that the settlement was favourable to us.

§ Mr. McNEILL
I think the way the hon. Gentleman put it was, what was the saving? I explained quite fully yesterday that it is not a question of saving; it is a question of liquidating the debt. What I pointed out was that the arrangement we have made with the Irish Free State was such that the interest upon the debt will be paid, the capital debt liquidated by the sinking fund forming part of these annuities, and that at the end of 20 years we shall have extinguished the debt. If that be realised—and, as I have already said, we do not anticipate that it will not he realised—surely that is a very satisfactory arrangement from our point of view, even if it were not also true, as I have pointed out, that it eliminates possible causes of friction and of overlapping between the two Governments. Moreover, it does not leave us in the position to pay charges over which we should have no control, and no opportunity of investigation. Therefore, both from the political point of view and the financial point of view, it appears to be an arrangement which this House might very reasonably accept.

Mr. DEPUTY - SPEAKER (Captain FitzRoy)
As there are some Private Bills set down for 8.15, the Sitting is suspended until that time.