Sterling Balances

HC Deb 25 February 1947 vol 433 cc1881-2

54. Mr. W. Shepherd

asked the Chancellor of the Exchequer what interest is being paid on the sterling balances which are held by overseas creditors.

Mr. Dalton

Most of these balances are in Treasury Bills at ½ per cent.

67. Mr. Boothby

asked the Chancellor of the Exchequer how much of the accumulated sterling balances held in London by our creditors have been used during the past 12 months for purchase of British goods and for the purchase of British assets abroad, respectively.

Mr. Dalton

In the year 1946 as regards the sterling area increases in accumulated sterling balances amounted to ½98 million, and decreases to £149 million. In the case of the non-sterling area, increases amounted to £201 million, and decreases to £81 million. These increases and decreases of balances represent the net result of the purchase and sale of goods and services to or from the United Kingdom and other countries, expenditure on British troops overseas, receipts from surplus disposals overseas, and movements of capital. Figures are not available of the amount used for the two purposes referred to in the Question.

Mr. Boothby

Is it not clear that we had a deficit during the last 12 months, and that sterling countries have been permitted by the right hon. Gentleman to use some part of their credits in this country for the purchase of goods? Does the right hon. Gentleman think that we are in a position to afford this, and will he say whether there is any principle governing his action?

Mr. Dalton

If my hon. Friend will read the figures he will notice that whereas, in the sterling area, the decreases were greater than the increases, to the extent of £50 million, in the year, in the non-sterling area the reverse was the case, to the extent of £120 million. I do not think, therefore, that the position is so bleak as the hon. Gentleman may have imagined when he put his Question on the Paper.

Mr. Walter Fletcher

In spite of the cloud of mystifying figures which the right hon. Gentleman has produced, is it not plain that we are, against no profitable return, financing and equipping places such as India with cotton machinery that had better be kept in this country?