HC Deb 03 December 1941 vol 376 cc1140-1
Mr. Pethick-Lawrence (by Private Notice)

asked the Chancellor of the Exchequer whether he has any statement to make about the amount of the fiduciary note issue?

The Chancellor of the Exchequer (Sir Kingsley Wood)

Yes, Sir. Owing to the continued demand for currency, an increase in the fiduciary note issue is necessary, and, acting under the power conferred by Section 8 of the Currency and Bank Notes Act, 1928, as subsequently amended, the Treasury have authorised an increase in the amount of the fiduciary note issue by £50,000,000 to £780,000,000 as from yesterday. The Treasury minute will be laid before Parliament forthwith.

Col. Arthur Evans

Is my right hon. Friend satisfied that there is no substantial hoarding of Treasury or Bank of England notes throughout the country?

Sir K. Wood

No, Sir, I would not say that. I should like to take the opportunity of asking people to reduce the number of notes which they hold. It would be far better and wiser either to invest them in National Savings Certificates or to put them into a bank or the Post Office.

Mr. Craven-Ellis

Does my right hon. Friend understand that at the present time, before the new increase, the fiduciary note issue is equivalent to £16 per head of the whole population, men, women and children, and does not that indicate that there must be some hoarding and that when the war is over and this money is released, there will be the possibility of inflation?

Sir K. Wood

I think hoarding is one of the reasons, but there is a variety of reasons. One, of course, is the much more frequent use of cash instead of cheques, and another is the increased use of cash caused by the separation of households.

Mr. Thorne

Is there not the danger that if people have too much cash about them, they will have it pinched?

Dr. Russell Thomas

Why is cash being used instead of cheques?

Sir K. Wood

There are a great many people who, because of the circumstances of the time, are using cash for the payment of their bills where previously they used cheques.

Mr. Lipson

Is not that true in the black market?

Mr. Craven-Ellis

Will not my right hon. Friend encourage the use of cheques?