HC Deb 19 June 1956 vol 554 cc1211-5
9. Mr. Gough

asked the Chancellor of the Exchequer whether he will make it a condition of Government permission for the sale of the Trinidad Oil Company that the dollar proceeds be used for Commonwealth development.

Mr. H. Macmillan

No, Sir. The dollar proceeds will accrue to the gold and dollar reserves, where they will be available for any purpose for which dollars may properly be acquired under current policies.

Mr. Gough

Would not my right hon. Friend agree that these dollars might be used to repay the World Bank in respect of its investment, for instance, in the Kariba Dam project and thereby ensure that the very valuable contracts arising out of that shall come to British hands and not Italian hands, as appears to be the case at the moment?

Mr. Macmillan

Yes, Sir, the increase in the dollar reserves will make it possible, no doubt, to approve of projects which otherwise it might have been difficult to agree to. All that will be helpful and valuable, but I must issue a warning against any idea that we should make a kind of separate individual island of United Kingdom reserves, because that would really be contrary to the whole system of the general sterling area banking for which we are responsible.

Mr. J. Griffiths

Does not the Chancellor agree that what is happening at present in regard to the Kariba scheme is a further indication that we are failing as a country to meet the need for economic development in the Common. wealth, and that this is a matter which ought to be seriously considered by the Government and by the House?

Mr. Macmillan

I think "failing" is a strong word, and in any event that is not the Question on the Order Paper; but of course the greater we can make the successful working of our operations in our balance of reserves and balance of trading the greater can be our contributions to investment in the world in general—in the Commonwealth, the Empire, and the outside world. That is the object of our whole policy.

Mr. Gower

Is it not possible that the dollars to be earned in this way will be dissipated, or spent, in a manner which will not ensure dollar earning power equal to the assets now being sold?

Mr. Macmillan

No, Sir; I hope that this increase, as it accrues, will make it possible for us to make approvals of investment in countries such as Canada larger than those taking place now, and that we can improve this rate.

Mr. H. Wilson

In view of the answer which the right hon. Gentleman has given to my right hon. Friend the Member for Llanelly (Mr. J. Griffiths), with which we all agree—that it is a question of getting a sufficient surplus—is he not aware that that was exactly what I was asking two or three minutes ago, when he described my attitude as narrow and peevish?

Mr. Macmillan

Yes, Sir, the attitude of mind with which the right hon. Member approached it was, as always, narrow, partisan and peevish.

Mr. Shinwell

Is there not something to be said, when we sell Commonwealth assets—and this is a Commonwealth asset—for the suggestion that we might earmark the proceeds for the purposes of Commonwealth development? Is not the right hon. Gentleman aware that both in Australia and South Africa there is a dire need of capital investment which cannot be met in any other way?

Mr. Macmillan

That is what I was saying. I very much hope that it will be possible to approve greater investment in the sterling area, but I must repeat that any suggestion that we should make a separate United Kingdom account of this money would be contrary to the spirit and regulations of the whole sterling area system.

Air Commodore Harvey

Will my right hon. Friend give two assurances—first, that none of this money will reach Colonel Nasser, and, secondly, that the money will not be frittered away in the same way as the party opposite frittered away the foreign investments in the Argentine and elsewhere?

Mr. Macmillan

I shall try not to follow that terrible precedent.

10. Mr. S. N. Evans

asked the Chancellor of the Exchequer whether he will make it a condition of the sale of the Trinidad Oil Company that the price paid by the Texas Oil Company should be in the form of a transfer of shares from the Texas company's holding in the Arabian American Oil Company, so as to entitle Britain to a seat on the board of the latter company.

Mr. H. Macmillan

No, Sir.

Mr. Evans

Is not the Chancellor aware that that is a very unsatisfactory Answer? How do we bring influence to bear on this company, which is actively engaged in anti-British propaganda, if we do not seize an opportunity such as that which the sale of this company presents? Is the Chancellor aware that Aramco, in which the Texas Oil Co. and its partners, Standard of California, have a 60 per cent. holding, has been responsible for more friction between Britain and the United States than Chiang Kai-shek and Formosa?

Mr. Macmillan

The broad question will be the subject of debate tomorrow. What I have to decide is whether, under the Exchange Control Act, which I have to administer, authority should be given to any particular transaction. I do not think that the proposal made in the Question would be a proper condition for the Treasury to make. [HON. MEMBERS: "Why not?"] We will argue it in detail tomorrow. I do not think it would be in the spirit of the Exchange Control Act, which was passed for the special purpose of defending sterling. That is the Act which I have to administer. I do not think that such a condition would be wise, and I do not think it would be acceptable. because it would have the result of altering the percentage of holdings of the different companies which form Aramco. In the long run—and this we can also argue tomorrow—the closer the relations between the oil companies and the closer the relations between the British Government and the American Government, the better we shall be able to deal with the problems which undoubtedly arise in the operation and the propaganda in the territory which the hon. Member has in mind.

13. Mr. Gower

asked the Chancellor of the Exchequer if he will now take steps to enable the control of the Trinidad Oil Company to be retained in the hands of people of the British Commonwealth; and if he will make a statement.

15. Mr. Hunter

asked the Chancellor of the Exchequer whether he will take steps to prevent the control of the Trinidad Oil Company being sold to United States interests.

Mr. H. Macmillan

I have nothing to add to the statement I made to the House on 14th June.

Mr. Gower

In view of the fact that the United States, with its comparatively large resources of oil, nevertheless finds it necessary to place severe legal restrictions on the foreign control of its mineral and oil resources, does my right hon. Friend think that we, with our far poorer resources as a nation and a Commonwealth, can afford to be less careful than the United States? Secondly, following his statement last week, can my right hon. Friend now say that there is the same unanimity in the Caribbean and in Trinidad towards this transaction?

Mr. Macmillan

I hope that my hon. Friend will not think me discourteous if I do not answer the details of his Question. We propose to debate this subject for four or five hours tomorrow afternoon, and it is much more easily dealt in debate and in speeches than in Question and Answer.

Mr. Hunter

Is the right hon. Gentleman aware that there is great public feeling against the sale of the shares of this company to American interests, except among those engaged in the City of London in this transaction? Will he bear in mind the great public feeling against this transaction?

Mr. Macmillan

Yes, Sir, but it is the broad economic, financial, political, imperial and international aspects which we propose to debate tomorrow afternoon, I think on the Motion for the Adjournment.

Several Hon. Members


Mr. Speaker

We should not anticipate tomorrow's debate. Dame Irene Ward.