HC Deb 03 April 1947 vol 435 cc2218-9
62. Mr. Norman Smith

asked the Chancellor of the Exchequer what has been the total increase of cost to the Treasury, to the end of 1946, by reason of the banks having transferred from Treasury deposit receipts to Government loans carrying higher rates of interest than that accruing on Treasury deposit receipts.

The Financial Secretary to the Treasury (Mr. Glenvil Hall)

It is not possible to give an estimate since many hypothetical factors are involved.

Mr. Norman Smith

Will the right hon. Gentleman say why it is—seeing that in these transactions the banks do not part with anything, but instead, as the Macmillan Committee on Finance and Industry pointed out, create what they claim to lend—the Treasury allows the banks to put a fast one over the taxpayers in this way?

Mr. Glenvil Hall

It is part of the contract that when these Treasury deposit receipts are taken up by certain banks they can, if they so desire, withdraw the deposit before maturity for certain kinds of investments, such as tax reserve certificates and defence bonds.

Mr. Norman Smith

Will the right hon Gentleman discontinue such contracts?