HC Deb 02 March 1932 vol 262 cc1102-3
37. Captain P. MACDONALD

asked the Financial Secretary to the Treasury if he will state the estimated amount which the Treasury will still have to find in order to obtain dollars and francs sufficient to pay off the credits to France and America in August?

Mr. CHAMBERLAIN

I am glad to be able to inform the House of substantial progress made in this matter. Arrangements have been completed to meet more than half the obligation. One hundred and fifty million dollars of the American credit will be repaid on Friday next, thus reducing that credit from roughly £40,000,000 to roughly £10,000,000. This repayment is final, the lenders having consented to return the proportionate part of the 1 per cent. commission as from the date of maturity of the existing bills. The credit given by French bankers is now reduced by approximately 1,600,000,000 francs, from roughly £20,000,000 to roughly £7,000,000. As my hon. and gallant Friend will recall the remaining section of these French credits is represented by Treasury Bills to the value of roughly £20,000,000 in the hands Of individual French holders, and we have no power to require them to accept repayment before August. I take this opportunity of removing a misapprehension which seems to have gained some currency, that the repayment of these credits involves in some way a loss to the taxpayer of £80,000,000. The original £80,000,000 of sterling obtained from the loans remains intact and is available for making the repayment. The necessity to acquire foreign currency with sterling at its present level for purposes of the repayment involves an apparent loss which will be borne by the Exchequer on capital account, but this loss is, at present, offset by the enhanced sterling value of our stock of gold. Accordingly no burden is being placed on the current revenues of the Budget.

Colonel WEDGWOOD

Does that mean that no provision need be made in next year's Budget for the loss on sterling?

Mr. CHAMBERLAIN

That is so.

Mr. KIRKWOOD

Will that report enable us to get some money to bolster up our industries here at home?