§ 55. Mr. Bellengerasked the Chancellor of the Exchequer whether he has noted the considerable rise in short-loan rates during April; and if, in so far as that was caused by the transfer of funds abroad with its concomitant pressure on the Exchange Equalisation Fund, he has any measures in view to prevent a recurrence of circumstances likely to have far-reaching consequences on national credit?
§ Sir J. SimonThe rise in rates was of a temporary character and cannot, I 1191 think, be said to have had permanent effects on the national credit. As regards the future, several factors may affect short-term rates at any given moment and it is not possible for me to anticipate whether any particular measures would be appropriate to deal with one factor in isolation from the rest.
§ Mr. BellengerDoes not the right hon. Gentleman agree that the considerable rise in short-term rates during April was due in some measure to the transfer of funds abroad, and in view of that fact, is he not prepared to take steps to prevent a rise in the cost of national borrowing in future?
§ Sir J. SimonI think it is a mistake to isolate one factor and deal with it as if it could be controlled. A number of things combine to effect the result here, and I am glad to say the temporary factor has, to some extent, been alleviated.
§ Mr. BellengerAm I to understand that the right hon. Gentleman still believes in laissez faire?
§ Sir J. SimonNo, Sir.