HC Deb 06 February 1940 vol 357 cc30-1
57. Mr. Woodburn

asked the Chancellor of the Exchequer what steps he is taking to ensure that the cost per £100 to the Government of borrowing on Treasury Bills is not increased beyond the point necessary to pay for the necessary bank outlays incurred on account of extra services?

Sir J. Simon

The hon. Member's proposal is impracticable. Treasury Bills are sold by competitive public tender and the rates tendered may depend on many different factors.

Mr. Woodburn

Has the attention of the Chancellor been called to a speech made this week-end by the chairman of an important bank to the effect that banks made exorbitant profits during the last war; and is the right hon. Gentleman aware that there is great apprehension in the public mind that, during this war, the banks will make great profits out of the needs of the community as a whole? My Question asks him what steps he is prepared to take to see that the remuneration of the banks is inline only with the additional services rendered by them.

Sir J. Simon

I did not so understand the Question. I thought it was in relation to the Government's borrowing on Treasury Bills. When the Government borrow on Treasury Bills they invite tenders and quite a number of factors determine the price.

Mr. Woodburn

Am I to understand from the Chancellor of the Exchequer that the Government can exercise no effective control upon the rate which Treasury Bills yield to the banks?

Sir J. Simon

Treasury Bills do not yield only to the banks as such, but to the persons who take up the Bills, whoever they may be.

58. Mr. Woodburn

asked the Chancellor of the Exchequer the cost of borrowing by means of Treasury Bills for the months of September, October and December, 1939; and how the cost per £100 compares with the similar months in 1938?

Sir J. Simon

As the reply is in tabular form I will, with the hon. Member's permission, circulate it in the Official Report.

Mr. Pethick-Lawrence

Is the Chancellor of the Exchequer aware of the very great deal of public interest in this matter, and will he not take some step to see that the cost of these Bills is not in excess of what it was before the war?

Sir J. Simon indicated assent

.

Following is the reply:

The total amounts of interest paid and the average rates per cent. for Treasury Bills sold by weekly tender were as follow:

Total interest. Average rate per cent.
1939. £ £ s. d.
September 1,872,816 3 10 10
October 1,147,123 1 19 11
December 880,497 1 4 6
1938.
September 261,971 14 2
October 445.958 17 2
December 370,442 19 6