HC Deb 27 July 1943 vol 391 cc1390-2
57. Sir H. Williams

asked the Chancellor of the Exchequer what steps are to be taken to prevent persons who have bought 480 lire for a £1 note in North Africa selling 400 lire for a £1 note in Sicily?

Sir K. Wood

Traffic between North Africa and Sicily will for some time to come be largely confined to Service personnel who, in the case of British Forces, are not paid in lire. The danger to which my hon. Friend refers is a real one in theory, but its effects are being limited by administrative measures, and certain further steps, of which I will inform the House in due course, have already been put in train to remove it.

Sir H. Williams

Is this a device for obtaining for no charge at all over 8o lire to the pound? Would my right hon. Friend describe this transaction as a sample of the definition of acquiring given by the Deputy Prime Minister a few minutes ago to Question No. 46?

Mr. Austin Hopkinson

Is it not the case that a far more serious danger exists than that? Anyone having a pound can buy 400 lire; with that 400 lire he then buys 4 dollars; with the 4 dollars he then buys £2 on the black market; with the £2 he then buys 800 lire; with the 800 lire he then buys 8 dollars; with the 8 dollars he then—[Interruption.]

60. Mr. G. Strauss

asked the Chancellor of the Exchequer the main considerations which induced His Majesty's Government, in co-operation with the United States Government, to fix the new lira rate at a parity of 400 to the £?

Sir K. Wood

In fixing the new rate account was taken, so far as was possible, of all the relevant economic factors, including the level of local prices and wages. I do not think that a more detailed discussion would be an advantage at the moment. The position is being kept under close observation, but I am sure that my hon. Friend would not expect the matter to be reviewed at the present time. Meanwhile, no information has reached me to indicate that any other rate might have been more appropriate. I would emphasise that in this, as in other preparations for military offensives, essential decisions must be taken in advance in the light of such information and advice as is available in conditions which preclude wide discussion.

Mr. Strauss

Are not the rates which have actually been fixed wholly out of accord with the price levels in the two countries? Is there not some further explanation which the right hon. Gentleman can give about these figures, which appear on the face of it to be out of accord with existing facts?

Sir K. Wood

No, Sir, I think that on the whole the best arrangement has been made at the present time. This is a matter which has to be arranged with the United States Government. On the last Occasion I referred to this subject I explained that it was provisional.

Mr. Stokes

In view of the fact that the rate of exchange prior to the war was of the order of about 70 lire to the pound, does not the right hon. Gentleman think that fixing it at 400 to the pound really amounts to loot and is likely to bring the Allies into disrepute?

Sir K. Wood

No, Sir, there is no foundation for such a statement.

Sir I. Albery

Is not this matter of great importance in view of future operations? Cannot some machinery be invented by which the Allies will jointly fix suitable rates for all occupied territories?