BANK RATE. (Hansard, 29 May 1940)

§ Mr. Stokes (Ipswich)
I have given notice to the Financial Secretary to the Treasury that I propose to raise the question of the Bank Rate on the Adjournment. This afternoon in the course of my speech I put a specific question to the right hon. and gallant Member and said that I had it on the authority of the Governor of the Bank of England that the Bank of England no longer controls the Bank Rate but that the Treasury does. I asked the Financial Secretary for a specific answer whether that was correct or not. Later on in the speech of the Financial Secretary I tried to elicit information but did not get any reply. I have tried on more than one occasion with the ex-Chancellor of the Exchequer to discover what are the facts, but I never got a satisfactory reply. In the last Debate I indicated to the ex-Chancellor of the Exchequer that I had it on good authority that the Governor of the Bank of England no longer controlled the Bank Rate. Let me give him a conversation I had with the Governor of the Bank of England. I said to him one day, "The Chancellor of the Exchequer tells me that he does not control the Bank Rate," and the reply I got was, "I regret to tell you, Mr. Stokes, that the Chancellor of the Exchequer did not tell you the truth." I do not know where I am. Apparently the Chancellor of the Exchequer says the Governor of the Bank controls the Bank Rate and the Governor of the Bank says the Chancellor of the Exchequer controls the Bank Rate. I think the House should know who does control it, and I hope the Financial Secretary will be able to give me a reply now.

§ Captain Crookshank
I apologise to the hon. Member for not having dealt with 625 this question before, but I thought it had been ruled out of order. All I can say is that the hon. Member has put this question several times before and has had on each occasion a similar answer from the Chancellor of the Exchequer. I have not his words here, but I think they were, to the best of my knowledge, that in these matters the Treasury and the Bank of England were in close contact. I should not like these words to be quoted against me because I have not the text of the speech, and the hon. Member and the House know that statements by Ministers have to be very carefully worded. As to what the Governor of the Bank of England may have told the hon. Member I am not called upon to express an opinion. I have no way of knowing what he may have said to somebody else, nor do I think that it is very relevant. All that I am concerned with is the statement made by the ex-Chancellor of the Exchequer, which explained the position I think perfectly clearly. If the hon. Member is not satisfied perhaps he will put another question to the present Chancellor of the Exchequer, who may be able to make the matter more clear to him than did his predecessor.

§ Mr. Silverman (Nelson and Colne)
I do not know why the Treasury should seek to veil this matter in so much mystery. The Financial Secretary has made an extremely clever speech for the purpose of not answering the question. It does not matter in the least what other people may have said at other times or whether what they have said was clear or not. The point is what is his answer now? It is quite a simple question, and it is not an unreasonable question for an hon. Member to ask. The question is, who is it that bears the ultimate responsibility for deciding what the Bank Rate shall be? It is surely not unreasonable for an hon. Member to ask that question. In these times, when we are raising by loan such large sums of money in more than one way, it is an extremely im- 626 portant matter to the country what the Bank Rate is. No one has ever suggested that the Bank Rate does not vitally affect every commercial asd industrial transaction, and more especially at a time when most of these transactions are under Government control. I am not sure that it is not a defiance of Parliamentary traditions that when a Member of this House asks a perfectly simple question upon a matter of the utmost importance he should be met with an extremely clever speech designed not to give him the information for which he asks.
Hon. Members will agree that the whole foundation of the rights and powers of this House rest upon its control over finance. I do not know how long, in these times, you can expect people to be content not merely that these questions are being dealt with in an apparently casual way, but that information is being withheld on the vital question as to where the responsibility lies and to whom criticism should be addressed. If the hon. Member for Ipswich (Mr. Stokes), who knows far more about these matters than I ever shall, wishes to advance, as would be perfectly within his rights, some criticism of the prevailing Bank Rate, to whom is he to address that criticism? Is it the Treasury that is responsible, or is he to criticise the Bank of England? Until that is known, any power of control in this House is impossible. I think that the House, no matter what may be its views on these questions, ought not to be satisfied with a situation in which nobody knows who takes the responsibility for deciding such an important question.

§ Mr. David Adams (Consett)
I wish to ask the Financial Secretary to the Treasury whether, if we put this Question on the Paper, we shall get a specific answer to it?
Question, "That this House do now adjourn," put, and agreed to.