§ 54. Mr. LAMBERTasked the Chancellor of the Exchequer what loans have been guaranteed for the Austrian Government by the British Government; what funding operations have taken place; and whether any and, if so, how much interest due is in arrear?
§ The FINANCIAL SECRETARY to the TREASURY (Mr. Hore-Belisha)His Majesty's Government have guaranteed 241 per cent. of the total service of the Austrian Government Guaranteed Loan, 1923–43. No funding operations have taken place. Since 1st July, 1932, the Austrian Government have suspended the monthly transfers into foreign currency for the service of the loan, and sums equivalent to about £580,000 were taken from the reserve fund held by the trustees in order to pay the coupon due on 1st December, 1932. No payments have up to the present been required from the guarantor Governments.
§ Mr. LAMBERTCan my hon. Friend say what is the amount in sterling of the 24½ per cent.; and when will these payments be resumed?
§ Mr. HORE-BELISHAThe original amount was equivalent in all to about £24,500,000; and I am just informed that the Austrian Government have now agreed to resume transfers on the 1923 guaranteed loan as from the 1st January, assuming that the Protocol of the 15th July, 1932, is ratified before the 31st December.
§ Sir A. M. SAMUELDoes not that mean that they are going to pay with what we are going to lend them?
§ Mr. LAMBERTDoes it mean that they propose to re-commence paying the interest out of the loan with which we are to oblige them?
§ Mr. HORE-BELISHANo, Sir. We are not to be the only guarantors, but we shall -receive moneys if the Austrian Government resume payment.
§ Mr. THORNECan the hon. Gentleman explain why the Government are willing to lend money to a foreign Government and yet debar our local authorities from raising money for useful purposes?
§ Mr. HORE-BELISHAMy right hon. Friend will explain that to-morrow.
§ Mr. CHARLES WILLIAMSAre we to understand from the original answer that interest is being paid out of capital in this case?