HC Deb 15 July 1946 vol 425 cc877-82
The Chancellor of the Exchequer (Mr. Dalton)

The House will, I am sure, share the satisfaction of His Majesty's Government that the United States Congress has approved the Loan Agreement. [HON. MEMBERS: "No."] If the Loan had not been forthcoming we should have had to face a serious increase in the austerity which we have endured so long. But now, though we shall still have to do without many imports which we should be very glad to have, we can confirm the plans we have already made for some much-needed expansion of supplies from abroad. We shall be able to authorise my right hon. Friend the Minister of Food to purchase foodstuffs which, if they can be obtained, will provide us with a more varied diet. We shall also be able to carry out our intention to arrange for more plentiful supplies of raw materials, and a limited increase in imports of manu- factured goods and, we hope, of newsprint. My right hon. Friend the Minister of Fuel and Power will make a statement on petrol in the course of a few days. We must keep a balance between the various demands upon us, since we cannot yet afford to buy all that we would like. To use a famous phrase, the Loan must be, for us, not a sofa but a springboard. We cannot relax our efforts in production, especially in the export trades. As soon as we can we must balance our overseas account. The value of the Loan is that it gives us a breathing space and new reserves of strength to accomplish this task. For this we sincerely thank the United States, believing that they and we have a common interest in reviving trade throughout the world, and providing good standards of living for men and women everywhere.

Mr. Oliver Stanley

I think that everyone in the House, whether they were in favour of or opposed to this Loan, must be glad that the long drawn out debate; have come to an end. On behalf of those who, like myself, believe that but for the loan this country might well have faced economic chaos, may I say how glad we are that it has come, and how glad we are to hear the right hon. Gentleman repeat the phrase of my right hon. Friend the Member for Woodford (Mr. Churchill) about its being a sofa and not a springboard. [Laughter.] I have got it the wrong way round. Watching right hon. Gentlemen reclining on the Front Bench certainly put me more in mind of a sofa than of a springboard. May I ask the right hon. Gentleman two questions arising out of this: first, does he now propose to undertake, with the various countries, negotiations with regard to the sterling balances, and second, what is the position now with regard to the international negotiations on commercial agreements which were proposed?

Mr. Dalton

I am much obliged to the right hon. Gentleman for what he has said. With regard to the sterling balance arrangements, as the House is aware and as is clearly set out in the Agreement—of which, for the sake of verification, I have a copy with me in Cmd. Paper 6708—we have agreed that we will now undertake discussions with the holders of sterling balances, and that of course we shall do. With regard to the international arrangements, my right hon. Friend the President of the Board of Trade has explained to the House on previous occasions that it will be a natural consequence of the Loan Agreement that conferences will be held on the conditions which have often been explained. The full conference will be preceded by a meeting of the so-called nuclear. Powers, which include not only ourselves but the other members of the Commonwealth. All that programme will now proceed.

Mr. Boothby

Arising out of the Chancellor's last answer, does that mean that pending this conference, all international negotiations on commercial agreements between this country and other countries will be held up?

Mr. Dalton

It is not His Majesty's Government's policy to hold things up, but to press them forward. I am not very clear what is meant. Perhaps the hon. Gentleman, when he has got over the shock of the announcement, would like to put a considered Question on the Paper.

Mr. Boothby

I was referring to matters such as Canadian wheat and Danish food.

Mr. Norman Smith

Are we to take that statement at its face value so far as it concerns the order of priority in which my right hon. Friend enumerated the prospective benefits of this Loan? Are we to assume from what my right hon. Friend said that the variegation of our diet Is first, being followed by access to raw materials and then, as I understand it, manufactured goods and, finally, petrol? Since we must get into debt to the country across the Atlantic, would it not be better that first priority should be given to coal-mining machinery and machinery for the textiles mills, productive machinery? Had not that better come first? Will my right hon. Friend call a conference of the Dominions to see where they come in under this sacrifice? After all, the Loan is responsible —

Mr. Speaker

It is Question time, not speech time.

Mr. Clement Davies

May I join in expressing satisfaction that, at last, this controversy has been terminated. May I also ask the Chancellor this question? There were three matters before us, Bretton Woods, the Loan, and the International Conference. To some of us the third is far and away more important than the others. What steps are the Government taking to urge forward the summoning of that Conference, which seems to be most vital for the world's general trade?

Mr. Dalton

The programme of this Conference has once or twice been postponed owing to the delays in Congress. I do not complain about them at all, but they have necessitated a postponement of the date. As to the date, it will be a matter for further discussion between His Majesty's Government, the United States Government, and the other Governments primarily concerned, particularly those in what I have described as the nuclear group. We have no desire to delay it unduly.

Mr. Scollan

I would like to ask the Chancellor what proportion do you think that you will lose of this Loan due to the removal of controls of prices in the United States? Do you know that it is estimated that you are likely to lose £50 million?

Mr. Speaker

I do not know anything about it.

Mr. Scollan

I want an answer to my question.

Mr. Speaker

The hon. Member addressed his question to me.

Mr. Scollan

No, Mr. Speaker, I addressed my question to the Chancellor.

Mr. Dalton

Calculations on the subject vary according to the calculator and according to the day of the week. Prices move about very rapidly, and I would prefer not to give an exact answer.

Mr. De la Bére

The right hon. Gentleman does not know anything about any of these things.

Mr. Gammans

May I put to the Chancellor a question arising out of what the hon. Member for South Nottingham (Mr. N. Smith) said? In view of the lush hopes he has held out for more clothes, more food, and more petrol, will he say whether this money is to be spent primarily on consumer goods, or the capital rehabilitation of this country? Surely, the only justification for this Loan, and the only hope of paying it back, is that we should spend it on capital equipment, and not, primarily, on consumer goods?

Mr. Dalton

If my answer is carefully read, it will be seen that, among the objects on which I have just announced a certain easement in the import programme, one of the classes is certainly machinery. It has never been contemplated that the British people, were this Loan granted, should continue in the present state of austerity with regard to consumer goods; and, indeed, that would not promote their efficiency in the regaining of our trade balance as soon as possible. If the hon. Gentleman does not want any fruit, there are plenty of other people who do.

Mr. Blackburn

Will the right hon. Gentleman agree to guard very closely against the use of this Loan, for which we are paying so heavy a price, for luxuries for the well-to-do, such as the total abolition of petrol rationing, which an hon. Gentleman opposite has suggested?

Mr. Henry Strauss

Who are the nuclear group? Is there any danger of nuclear fission?

Mr. Dalton

None at the moment.

Colonel Crosthwaite-Eyre

Can the right hon. Gentleman give any assurance that any action taken by His Majesty's Government in settling the sterling balances, will first be brought before this House, before any action is actually taken by the Government?

Mr. Dalton

No, Sir, I will give no such undertaking. Any arrangement made by His Majesty's Government with any other Governments in the Dominions or elsewhere will be submitted to this House, if desired, after it has been taken, for ratification.

Mr. Cobb

Will the right hon. Gentleman pay particular attention to the expenditure of dollars on American goods also in production in this country? He will surely take the view that we want to be sparing on expenditure on goods we are producing here.

Mr. Dalton

We must be very careful all along the line, here and elsewhere.

Mr. Drayson

The right hon. Gentleman has said he will authorise the Minister of Food to purchase extra food in the United States. Will he also authorise the Minis- ter of Agriculture to purchase feeding stuffs, so that we can convert them in this country into food for human consumption?

Mr. Dalton

If there should be feeding stuffs available, that would certainly come within the field of increased purchases that we would examine sympathetically.

Mr. Medlicott

Is the right hon. Gentleman aware that many of us feel that it would not be out of place if we were to express our appreciation and gratitude for what is, after all, a friendly gesture from our late Ally?

Mr. Dalton

I wholly agree; and in my statement I said that we do sincerely thank our American Ally in the war, hoping that we and they, and all those others who fought together against the grim menace that confronted us, will continue united in peace.

Mr. Beverley Baxter

As one of the many Conservatives who think that this Loan may be the prelude to disaster, may I ask in what period the Chancellor expects to go into a huddle for the elimination of Imperial preferences, and the sell-out of the Empire?

Sir Stanley Reed

Will the right hon. Gentleman accept the assurance that there is quite a considerable element in this country who will gladly accept the present, and even future, austerities rather than see this heavy burden borne without a proportionate improvement in our productive power, and a reduction in our sterling obligations?

Mr. Speaker

We do not seem to be getting much further now.