HC Deb 22 January 1953 vol 510 cc518-28

Motion made, and Question proposed, "That this House do now adjourn."—[Sir H. Butcher.]

9.59 p.m.

Mr. Norman Smith (Nottingham. South)

I want to raise a matter which concerns not only Wales but the whole of these islands where the writ of Her Majesty's Government runs. I propose to take the opportunity afforded me by the luck of the ballot to raise in this House the question of the £1 and 10s. currency notes, which all of us and our constituents use pretty well every day of our lives. I think it worth while to point out that I am enabled to raise this question—

It being Ten o'Clock, the Motion for the Adjournment of the House lapsed, wihout Question put.

Motion made and Question proposed, "That this House do now adjourn."—[Sir H. Butcher.]

Mr. Smith

I was saying that I am enabled to raise this question of currency notes on the Adjournment by virtue of the provisions of Section 4 (1) of the Bank of England Act, 1946, which lays down that the Treasury may from time to time give such directions to the Bank, after consultation with the Governor of the Bank, as are thought to be necessary in the public interest. It seems quite evident that any function of the Bank comes within the purview of the Treasury, and, among those functions, is the issuing of currency notes for the convenience of the public.

The House may judge therefore of my surprise when, on 20th November of last year, I received from the Financial Secretary to the Treasury, whom I am glad to see in his place, a written answer in which he said that he was satisfied that the Chancellor's powers under the Act were not appropriate for the purpose I had in mind, the purpose of directing that those notes should be replaced as soon as might be during Coronation year with notes of a new design incorporating the image of the reigning Sovereign.

That is what I am after. I want the image of Her Gracious Majesty the Queen to appear upon the £1 and 10s. bank-notes. I am under no illusion that we could replace the whole of the £1,800,000,000 note issue with completely new notes in time for the Coronation. I believe that 80 per cent. or 90 per cent. of those notes are £1 or 10s. notes. I have no doubt at all that if the attempt were made to replace them all by Coronation day, it might be done, and that if it were physically possible it would be done; but it would be unduly costly. All I am asking of the Financial Secretary is that he should start the job now, because sooner or later every one of those notes will have to be replaced. Sooner or later new plates will have to be made and I am asking that the Government should put the job in hand and make a start now to bring the new plates into existence.

My postulate is that everybody in the country would rejoice at this change and would love to see the image of Her Most Gracious Majesty upon these £1 and 10s. notes. I find it hard to believe that there would be any exception, and I would undertake that no class of society would be more delighted than the wage-earning classes, who send me to this House and who draw their wages week after week mainly in those notes.

I suppose I am right in assuming that everybody would rejoice in this change. But I wonder if I am. When I found that I had drawn this Adjournment out of the hat, I made soundings to certain hon. and right hon. Gentlemen opposite who are known to be prominent in the world of finance and I sought to enlist their support for the purpose which I am now seeking to pursue. I was surprised, and even startled, to be met with a complete negative and to be reminded in tones of some asperity that these currency notes were the business not of this House but of banking gentlemen in the City of London.

Having a rather lively imagination, I allowed my mind to go back some 300 years to a period when the predatory and prehensile merchants and goldsmiths of the City of London had organised themselves together, and indeed had taken up arms, for no less a purpose than that of overthrowing the Monarch rather than allow the Monarch to exercise the reality of financial control. Moreover, on the benches opposite there are at the present time in the Conservative Party at least two hon. Members whose ancestors in the 17th century, after the Restoration, paid the penalty of death for the part they had played in that rebel movement. Colonel Harrison, the regicide, who was executed after the Restoration in 1660, was, I am told, the direct ancestor of the hon. and gallant Member for Eye (Colonel J. H. Harrison) and Sir Harry Vane the younger, who was not a regicide but a rabid republican who also paid the death penalty, was a direct ancestor of the hon. Gentleman the Member for Westmorland (Mr. Vane).

Bearing these circumstances in mind and having regard to the firm and resolute negative I met when I sought support on the other side of the House, I asked myself whether the Conservative Party, notwithstanding its ostensible support of the facade of the constitution—support which is illustrated admirably in a little book lent to me by my hon. Friend the Member for Dudley (Mr. Wigg), and which takes the form of the Union Jack on the cover and the portrait of Her Majesty flanking that of the Prime Minister inside of this book called "The Dudley Conservative Association Coronation Year Book"—whether, after all, the Conservative Party did not really feel most strongly about those causes which it has most at heart and in which I would venture to include the financial hegemony which so long gave them the economic ascendancy in this country.

However that may have been, this I most certainly know: that the Bank of England now is nationalised, and many of us who are its proprietors do not like the design of these £1 and 10s. notes, an example of which I hold in my hand. We have very good reasons for not liking the design of them. It is because in 1928 the then Governor of the Bank of England, Mr. Montagu Norman, when a Conservative Government of that day handed over to him the Treasury note issue which had originated with the war emergency in 1914, lost no time in giving effect to his personal political prejudices. He was not having the image of the reigning Sovereign on the front of his bank note; he promptly took His Majesty King George V off the front. Nor was Mr. Montagu Norman having the engraving of the Houses of Parliament on the back of his bank note; he promptly took that off and substituted a building to which I will refer presently. Mr. Montagu Norman removed the symbols of public control and hastened to put in their place meaningless symbols which disfigure the note that I hold in my hand.

Mr. Deputy-Speaker, I invite your attention and that of the House to the principal inscription on the face of this note: I promise to pay the bearer on demand the sum of one pound. That is the piéce de résistance. That is the central inscription. What on earth does it mean, if it means anything at all?

Let us imagine that the Financial Secretary, who has no inconsiderable persuasive powers, went along to the Bank of England, sent in his card and saw Mr. Beale, the Chief Cashier, whose signature backs this inscription. Imagine that the Financial Secretary said, "Mr. Beale, I have come for my pound." What would Mr. Beale give the Financial Secretary? A pound of tomatoes? Another pound note? That would only be derisory. Two ten shilling notes? But the ten shilling note carries the same meaningless inscription. Twenty shillings' worth of cupro-nickel coins? But those again have a purchasing power which varies almost from month to month and does not represent anything stable. I should like the Financial Secretary to defend, if he can, this fantastic, meaningless nonsense on the front of the notes.

Now let us turn to the back of the notes, to the extraordinary building depicted thereon. That building is the Bank of England building; but not the Bank of England which all of us know so well, that military strongpoint in the very heart of the City of London, but rather the substructure of that building as it used to be away back in 1924, when the reconstruction began which lasted, in fact, from 1924 until 1938. I wish that the Financial Secretary could justify the continued perpetuation on the back of our banknotes—they are our notes now —of a building which used to be like that 30 years ago but is not like that any more.

Let us come back again to the front of the notes. In the top left-hand corner, instead of the image of Her Most Gracious Majesty, which, I am perfectly certain, millions of loyal British men and women would love to see, what do I find? I see the symbol of Britannia. I quote now from information supplied to me very kindly by the Bank of England two or three weeks ago: Britannia sitting on a bank of money was derived from the figure of Roman coins personifying Britannia as one of the Roman provinces. I submit to the House and to the Financial Secretary that it is a very long time since this country was a Roman province and whatever chance it may recently have had of becoming a Roman province was removed very effectively by our friends and comrades of the Eighth Army at the battle of Alamein. I sumbit, therefore, that Britannia in that respect is out of place and ought not to be there.

The Bank of England further go on to inform me very kindly about this Britannia on the front of the notes. They say: The original heap of money, which started as a rather untidy heap of guineas. became in successive designs more and more regular in outline and less elaborate in detail until it developed into something very similar in appearance to the beehive, the symbol of industry, which in 1855 was incorporated in the design by Daniel Maclise, R.A., and has since been used on Bank of England notes of all denominations. I want to put up, first, that a beehive in this technological age is not really an appropriate symbol of industry. I will give the Financial Secretary an idea which is worth quite a big fee. I suggest that a very much more appropriate contemporary symbol of industry would be the delightful device which used to appear upon the London County Council tramcars in the glorious days of Aubrey Llewellyn Coventry Fell. I am open to correction, but I think that it was on the L.C.C. tramways. The Financial Secretary is too young to remember Mr. Fell. The device consisted of an armature rotating between the poles of a horseshoe magnet. It symbolised Faraday's great discovery which gave us electric power. That is a beautiful device. If the Financial Secretary were a little older and could remember that thing on the tramcars, he would agree that it is far more appropriate than the beehive.

There is something else that I want to put up about Britannia. I think that Britannia itself is outmoded on these notes. We live in 1953. Britannia no longer rules the waves, and Britannia. much as we may regret it and as I personally deplore it, will never rule the waves again. It will not do so for reasons which are quite ineluctable.

Nobody rejoices more than I do in the glorious annals of the Royal Navy, but I am under no illusion that there will ever be a repetition in our time, or in any other time, of such glorious incidents as the naval engagement off Boston, Massachusetts, in 1813, when H.M. frigate "Shannon" fought, beat, captured by boarding and brought across the Atlantic as a prize the greatly superior in every material way American frigate "Chesapeake," which afterwards rotted in the Medway. Things like that will just not happen again.

We may ask ourselves, therefore, why the Bank sticks to Britannia. The reason is that the Bank began with Britannia, and being conservative—not in the party political sense—is unable to think up anything better. The Bank adopted this Britannia three days after their Charter was given them by the Government of William III, the Dutchman who, as the House knows, came to the throne in consequence of the rather dubious political revolution of 1689. The Bank put it on the notes in 1694 and never departed from it. I suggest that we really ought to have that removed and put Her Majesty in its place.

Another argument I adduce with some trepidation. I do not pretend to be an artist, although I am the father of a girl who pursued a very successful artistic career until she was caught up in the web of matrimony, housewifery and motherhood. That is my only qualification for posing as an artist; but I say quite seriously to the Financial Secretary and to the House—and I am subjective about this—that I felt very much pleasure only this morning when, as one of the hon. Members for the City of Nottingham, I visited in Chelsea Mrs. Mary Gillick, the distinguished artist who used her skill to put Her Majesty's head so delightfully on the new coinage. I handled the coins and I derived immense pleasure from that. I do not derive the same pleasure from contemplating this horrible heterogeneous hotch-potch of a bank-note.

Consider the print, of which on the front there are at least six different types which fairly scream at each other. On the back there are three different scales of dimension which absolutely kill each other—the bank building, St. George and the Dragon, and the Greek acanthus. I submit that on artistic grounds this note is a real horror. I am quite well aware that Mr. Norman had much artistic taste, but I can only conclude that in passing this design for the bank-note he was allowing his political enthusiasm to run away with his artistic judgment.

I do hope that the Financial Secretary will assure the House that he is to make a start. It may be belated, but I make no party point of that; it ought to have been made by my right hon. Friend the Member for Bishop Auckland (Mr. Dalton) after we got the Bank in 1946 so there is no party point on the question of belatedness. I believe I have taken away one of the points of the Financial Secretary's reply. But I am asking him to make a start.

What I am asking is not unprecedented. Most of us at one time or another have been in Canada or some of the Colonies where notes circulate bearing the image of the reigning Sovereign. Most of us have had that happy experience, I am asking the hon. Gentleman to get on with the job, which need not cost very much if spread over a sufficient length of time, but which I can assure him would give very much pleasure to millions of loyal British hearts, who might even show their appreciation by dubbing the notes "Boyd-Carpenters."

10.17 p.m.

The Financial Secretary to the Treasury (Mr. John Boyd-Carpenter)

The hon. Member for Nottingham, South (Mr. Norman Smith) began his speech by stating that he had a lively imagination. Whatever proposition he may subsequently have succeeded in proving, no hon. Member would dispute that he established that proposition to the complete satisfaction of the House. Indeed, he indicated round his central theme of the design of the 10s. and £1 Bank of England notes that he was executing a lively foray in which he had a good deal of fun and in which, I am sure, the House was very happy to join.

I do fully appreciate the general public pleasure which derives from seeing portrayals of Her Majesty on all appropriate occasions, and I can at any rate encourage the hon. Member by repeating what I said to the House some little time ago, that we hope that the new coinage, which will bear the effigy of Her Majesty, will, in general, be ready before the Coronation. Up to that point I think I can meet the hon. Member and say that I fully sympathise with and understand his feelings, which are very widely shared in that general direction.

But when we come to the question of Bank of England notes, the issue is not quite as simple. On 20th November last year, as indeed again tonight, the hon Member asked that my right hon. Friend should exercise his powers of direction under Section 4 of the Bank of England Act, 1946, and should direct the replacement of the existing Bank issue by notes bearing Her Majesty's portrait. I made it clear on that occasion, as I am bound to do again tonight, that this is not the sort of step which in our view comes within the exercise of that power of direction.

When hon. Members opposite nationalised the Bank of England, their right hon. Friends made it clear that the powers of direction contained in Section 4 were intended to be exercised only on major matters of national policy and that it was not intended to interfere with the normal conduct by the Bank of its affairs. It seems to us that the precise design of the notes issued by the Bank of England does not come within that definition of major policy. Provided that the design is reasonable and unobjectionable, it really seems to us one of the matters which the Act of Parliament passed by hon. Members opposite did leave to the Bank.

I do not want to strain that argument too far. If the Bank went mad and insisted on putting on its notes—if I may use this by way of illustration—life-sized reproductions of the hon. Member's head, then no doubt my right hon. Friend the Chancellor of the Exchequer might incline to think that the effect of that would be so adverse on public confidence in the issue that lie might be called upon to interfere. But short of highly hypothetical situations, the precise make-up of Bank of England notes, it seems to us, is and was intended under the 1946 Act to be a matter for the discretion of the Bank.

Therefore, so far as any question of issuing a directive under Section 4 is concerned, I am bound to repeat to the hon. Member what I said to him a few weeks ago. Perhaps it would be courteous in the few moments that remain if I were to deal with what seemed to be implied, though I do not think it was expressly requested in his speech—that we should suggest to the Bank the superior desirability of a note designed to include the rather different components which the hon. Member appeared to have in mind.

In particular, the hon. Member suggested, as he did in a letter which he wrote to my right hon. Friend a little time ago, abandoning the use of the effigy of Britannia which, as he knows, has been associated with the Bank of England since as long ago as the Year of Grace 1694. If it were a matter for me, all my instincts are against breaking a practice which has lasted so long and breaking the continuity in this respect which, as in so many others, has proceeded during two and a half centuries of the Bank's existence. They have been two and a half centuries of some of the most difficult periods in human history, during which the Bank has played an enormously valuable part in our national affairs, and at the end of which, as I think all hon. Members will agree, it stands with perhaps the highest reputation of any bank in the world.

Unless there is good practical reason for it, my own feeling is all against making a deliberate breach of that continuity. Indeed, when the hon. Member gives his reason for that breach, I am reinforced in my view. He repeated in somewhat similar terms today what he said in his letter to my right hon. Friend: This design of Britannia adopted by the Bank of England in 1694 represents an ideology now hopelessly outmoded by events. You will agree with me that for good or ill Britannia can never again rule the waves. I could not disagree with the hon. Member more. And when he goes on to say that episodes of our naval history like the memorable engagement of the "Chesapeake" and the "Shannon" are completely out of date, I am bound to recall to his memory the no less equally splendid action, only a few years ago, off the River Plate and the many other superb episodes in our naval history. If the hon. Gentleman's case is that the effigy of Britannia is out-dated because the doctrine of Britannia's connection with the waves is out-moded, it seems to me the reason he has given is the strongest reason against his proposition.

Britannia and the effective power of the Royal Navy is still, as they have been for hundreds of years, one of the major factors for preserving the peace and security of the world. At this very moment Her Majesty's ships are engaged in Korean waters in support of the action of the United Nations. Our Mercantile Marine today is the greatest in the world. Therefore, to suggest that our supremacy at sea has deserted us seems to be so inconsistent with the facts as wholly to invalidate his argument. I cannot see any better symbol for the principal banking institution of a nation such as ours which depends upon sea power for its survival in peace and war than this very emblem of Britannia which, for rather odd reasons, the hon. Gentleman seems to decry.

The hon. Gentleman was good enough to suggest, as some inducement in favour of his proposition, that the notes, as amended by him, should in some way be connected with my name. I should have been more impressed by that genial suggestion had the hon. Gentleman not already made that offer in another direction. In the letter which he wrote to my right hon. Friend and to which I have already. referred, he added these words: Forgive me if I tempt you with a personal suggestion. Is it not likely that the new notes may generally be known as 'Butlers'? The hon. Gentleman has really over-sold that market, and therefore the inducement he offers to me, having been already offered, as he knows in vain, to my right hon. Friend, has been wholly deprived of its power to tempt.

Therefore, while I say with all seriousness that I appreciate the deep liking all of us in this country have for the proper use of the effigy of Her Majesty on all appropriate occasions—and perhaps particularly in this Coronation Year—I am bound to tell the hon. Member and the House that, though I am perfectly certain his suggestion is most admirably intended, and although I am equally bound to say I have some sympathy with some of the things he has said, the important power of direction to the Bank should not be used simply to alter the design of the notes; and therefore the reasons which he gave for his preference for a new design are reasons which I am unable to accept.

Although my personal predilection and the pleasure which I, in company with all hon. Members, derive from his speeches naturally tempt me to say, "Yes" to almost any proposition he may make, in this case I am bound to say the facts and the realities of the situation put me in the regrettable position of having to say, "No."

The Question having been proposed at Ten o'Clock, and the debate having continued for half an hour, Mr. SPEAKER adjourned the House without Question put, pursuant to the Standing Order.

Adjourned at Half-past Ten o'Clock