HC Deb 09 December 1953 vol 521 cc1976-81

The following Questions stood upon the Order Paper:

51. Mr. Frederic Harris

To ask the Secretary of State for the Colonies, now that the Member for Finance of the Kenya Government, the Hon. E. A. Vasey, has returned to Kenya from his visit here, if he will state what financial assistance Her Majesty's Government has already given to the Kenya Government; and what further financial assistance is contemplated in the near future

52. Mr. Alport

To ask the Secretary of State for the Colonies whether he will make a statement with regard to special financial aid for the Colony of Kenya

At the end of Questions—

Mr. Lyttelton

With your permission. Mr. Speaker, I will answer Questions Nos. 51 and 52 with regard to financial assistance to Kenya.

I have now reviewed the financial position with the Governor and the Member for Finance and am able, with the agreement of my right hon. Friend the Chancellor of the Exchequer, to make the following announcement.

The Government and people of Kenya will, I feel sure, wish to take such steps to increase their revenues as they reasonably can, without disrupting their economy or unduly deterring that inflow of capital which is so badly needed. But, even when allowance has been made for this, they will not be able, unaided, to continue to bear the burden of emergency expenditure and at the same time to press ahead with essential social and economic development.

Precise forecasting is difficult, but the best estimate we have been able to make is that the Kenya Government will need assistance of about £6 million if they are to maintain a reasonable level of liquid resources and continue to meet their obligations at least until the end of the United Kingdom financial year 1954–55. I am glad to be able to announce that Her Majesty's Government will be prepared, subject to Parliament, to make that sum available as a contribution towards the cost of Kenya's emergency, £4 million as a grant and £2 million as an interest-free loan.

Should the present rate of emergency expenditure continue throughout the period, it is possible that more may be required thereafter. In that event Her Majesty's Government will be prepared to review the position in good time.

As the House is aware, the need for intensified agricultural development is greater in Kenya than in other African territories because it is in Kenya that pressure on the land is greatest, and there are also special resettlement problems arising out of the movement of population during the emergency. Her Majesty's Government have therefore decided that, in addition to the £6 million assistance towards the cost of the emergency, a further grant of £5 million should be made for the specific purpose of financing a five-year plan, to be prepared by the Kenya Government and approved by Her Majesty's Government, for African agricultural development and rehabilitation.

Of the £5 million required for the five-year plan, it is expected that £1 million will be needed during the first year. One half of this will be added to the £6 million Emergency grant for which Parliamentary sanction will be sought, and the other half, as well as the balance of £4 million to be used in later years, will be found from Colonial Development and Welfare funds. Issues up to the total of £5 million will be made against approved schemes.

The Kenya Government asked for a loan of £1 million a year for 10 years to meet certain charges on African education. I do not feel that, in this field of education, the same special case can be made out for distinguishing Kenya from other African Colonies; but I have suggested to the Governor that this need should be included in his reply to the request, which I have made to all Colonial Governments, for information of their estimated needs for financial assistance for the next five-year Colonial Development and Welfare period beginning in 1955.

The £6 million Emergency assistance and the grant of £5 million for African agriculture should enable the Kenya Government to look ahead with confidence and to carry on with the economic and social development of the country.

These sums are, of course, additional to the extra Colonial Development and Welfare allocation of £500,000 of which I informed the House on 29th April.

Mr. F. Harris

Is the Secretary of State aware that this statement will give considerable satisfaction to all races in Kenya, as the people there are deeply concerned that the heavy financial burden, caused by the Mau Mau problem, will, unfortunately, retard the progress which is so vital to the country? May I also ask why Her Majesty's Government make a charge to the Kenya Government for a large portion of the troops sent to Kenya? Is that a unique situation, or is it done in any other part of the world?

Mr. Lyttelton

The hon. Member will have to put a Question on the Paper with regard to the last part of the supplementary in order that I can give the details in full.

Mr. J. Griffiths

May I ask two questions. I am sure we all desire to see money provided for future development in Kenya. First of all, we have a right to expect that those who live in Kenya, and who are able to do so, should make a full contribution to the cost. Would the right hon. Gentleman indicate to the House, either now or at an early date, what special contribution, by way of increased taxes or in other ways, those people in Kenya will be asked to make?

The second question relates to his answer about education, in which, if I understood the right hon. Gentleman correctly, he said he saw no reason to distinguish between the educational needs of Kenya and other territories. Whilst recognising that we must assist African education in all colonies, may I ask if there is not a special reason in Kenya for such assistance, in view of the fact that African schools were closed down as a part of the emergency operation? There is surely great need to replace the schools which are not now there. That makes out a very strong case for a special contribution towards African education.

Mr. Lyttelton

I am not in a position to make a statement now. I touched upon that aspect in the early part of my statement and I shall make a further statement upon the matter very soon. I cannot do so at the moment because it is still being discussed with the Kenya Government.

With regard to the second part of the supplementary, this is a matter of priorities and I do not think that there is a case now for making loans against recurrent expenditure on education which was what the proposal of the Kenya Government amounted to. That will take its part in the long-termplan which we have for Kenya and other parts of the Colonies.

Mr. Griffiths

Is it not a fact that there are some thousands of African children who were in schools which were closed and now have no schools to go to, and is there not a need to replace those schools with others built by the Government?

Mr. Lyttelton

I am not going to dispute the fact that the advance of education in Kenya is very important, but the right hon. Gentleman will see the very sharp rise in the expenditure on education which we have been able to bring about in the last few years.

Mr. Alport

Is my right hon. Friend aware that this assistance will make a tremendous advance in dealing with the problem of the troubles in Kenya, and will he say whether any of this money is to be made available for the very great problem of African housing?

Mr. Lyttelton

I think I have already covered the general use which will be made of these sums by the Kenya Government, and I think I should not like to be more precise, but the Kenya Government will know how to apply them to the best advantage to the Colony.

Mrs. White

Has the attention of the right hon. Gentleman been drawn to the statement made by the Finance member of the Government of Kenya, when he returned to Nairobi, on this matter of education? If he thinks a loan for current expenditure is not the correct method of financing it, will he, nevertheless, reconsider this extremely important problem? Otherwise a great deal of the other money which he proposes to give to Kenya may be wasted.

Mr. Lyttelton

I could not agree with the suggestion of the hon. Lady, nor do I think that a large part of her supplementary represents the facts. It will not be wasted at all. The expenditure in the last few years on education has risen very sharply indeed, and the Kenya Government will be able to put forward schemes under the Colonial Development and Welfare Act.

Mr. Emrys Hughes

Is the right hon. Gentleman aware that the whole idea of five-year plans and interest-free loans is rank Communism?

Mr. Lyttelton

The hon. Gentleman is a better judge than I am of what is rank Communism and what is ordinary Communism. I do not really admit the force of his interruption on quite the same scale as I did yesterday.

Mr. Dugdale

In order that we may have a clearer picture of the situation, will the right hon. Gentleman tell us the rates of Income Tax and Surtax now being paid in Kenya, and whether he thinks they are satisfactory?

Mr. Lyttelton

The right hon. Gentleman must put that Question on the Order Paper. I have not the figures, and it is a very complicated table. In the early part of my statement I expressed the certainty—and not without some reason—that the Government and the people of Kenya will be willing to take steps to increase their revenue.

Viscount Hinching broke

How soon will the provision be brought before the House? Will there be legislation relating to the loan, and will there be a Supplementary Estimate for the grant?

Mr. Lyttelton

I shall have to come to the House and ask for this money by one means or another.