§ 86. Mr. W. J. BROWNasked the Chancellor of the Exchequer why the Post Office prospectus in connection with the Five per cent. Conversion Loan was not allowed to be issued before the 6th November, whereas the Bank of England issue was advertised in the Press on the 4th November; why a limit of £1,000 was imposed in connection with Post Office 2221 dealings in subscription issues; and why holders of Five per cent. War Stock and Five and a half per cent. Treasury Bonds, 1930, who desire to convert their Post Office register holdings of more than £1,000 must first purchase an equivalent amount of the new issue?
§ Mr. P. SNOWDENIn view of the need for secrecy it would be impracticable to have 14,000 post offices ready furnished with forms and prospectuses immediately the first announcement is made. In this case the complete Post Office prospectus was available two days before the list opened.
In reply to the second part of the question, the Post Office accept cash subscriptions from £5 to £1,000 and the Bank of England from £50 upwards. The reason for a maximum limit in the case of the Post Office is that stock on the Post Office register, unlike stock on the Bank of England register, is not liable to deduction of Income Tax from dividends at the source. A limit to Post Office subscriptions is not new and was, for instance, fixed at £200 in 1915. More recently there has been no limit, but the result was unsatisfactory, as some very large investments were made to avoid tax deduction at the source. I am anxious to continue the tax privilege for the convenience of the small investor, but I cannot contemplate leaving it open with-out a limit to individual transactions.
I do not follow the third part of the question. Holders of Five and a half per cent. Treasury Bonds on the Post Office register can convert without purchasing an equivalent amount of the new issue. If their holdings are more than £.1,000 they can transfer the excess to the Bank of England and convert there. The condition that conversion of Five per cent. War Loan is subject to purchase of the new loan is common to both registers.
§ Mr. HARRISIs the right hon. Gentle-man aware that the result of this policy is to give an advantage to big buyers as opposed to small buyers; and will he, therefore, if there is an over subscription to the loan, take steps to protect the interests of buyers through the Post Office?
§ Mr. SNOWDENNo, Sir. This condition is a very common one.