HC Deb 01 November 1932 vol 269 cc1611-2
42. Colonel WEDGWOOD

asked the Chancellor of the Exchequer whether, as the restriction on optional conversions requiring public issues or underwriting prevents manufacturing companies, public and private, from converting debenture issues or debts at a high rate of interest, it is intended that Governments such as the Union of South Africa are to be given a preference in the use of British capital?

Mr. CHAMBERLAIN

The loan recently raised by the Government of the Union of South Africa was a loan for the provision of new money for expenditure within the Empire. Any borrower, other than foreign, may borrow without impediment for the like purpose. Dominion borrowers enjoy the same range of facilities as home ones but have not a privileged position.

Colonel WEDGWOOD

Is it not a fact that the home borrower cannot borrow to convert existing debt if any appeal for fresh funds is involved in the operation?

Mr. CHAMBERLAIN

Yes, that is so.

Colonel WEDGWOOD

Is not that discriminating against the home borrower in favour of the Government of South Africa?

Mr. CHAMBERLAIN

No, Sir. The distinction is between borrowing for new works and borrowing merely for the purposes of converting an already existing debt.

Colonel WEDGWOOD

In that case, is Australia unable to take advantage of the English capital market for converting, at the present time, its existing debt?

Mr. CHAMBERLAIN

No, Sir, Australia is in exactly the same position as the Union of South Africa.