BANK RATE INCREASE (INQUIRY) (Hansard, 13 November 1957)

§ The Prime Minister (Mr. Harold Macmillan)
With permission, Mr. Speaker, I wish to make a statement.
Yesterday, certain Questions were put to my right hon. Friend the Chancellor of the Exchequer concerning an allegation that there had been a leakage of information regarding the intention to increase Bank Rate.
My right hon. Friend was asked to say what individuals he saw on the day preceding the increase in Bank Rate. He took the view that it would be contrary to precedent and damaging to the conduct of public business to disclose the confidential discussions which are frequently held in advance of an announcement of Government policy; and he therefore declined to give the information sought.
But in view of the interpretation which has been placed on his replies I have decided, with his full concurrence, that this information should be given on this occasion. I wish to say at once that I have the categorical assurance of my right hon. Friend that in the interviews to which I am about to refer nothing was disclosed about the intention to increase Bank Rate. But, apart altogether from Bank Rate, the Government were about to announce a number of important measures for dealing with the economic situation, including the limitation of bank advances, control of the money supply and the adjustment of public investment. These measures must inevitably have wide repercussions on wages, profits and many other sections of the economy.
It was, therefore, both necessary and normal that the presentation of these measures to the public should be discussed in advance with a number of interested persons including certain representatives of the Press. Accordingly, in a series of separate interviews during the afternoon of 18th September, my right hon. Friends the Chancellor of the Exchequer, the Minister of Labour and the Minister of Power explained these measures to representatives of certain of the nationalised industries, to representatives of the Trades Union Congress 965 and the British Employers' Confederation, to representatives of certain newspapers and to Mr. Oliver Poole, the Deputy Chairman of the Conservative Party.
I wish once more to say that I have been assured that in none of these interviews was any disclosure made of the intention to increase Bank Rate. I accept those assurances. Moreover, full information about these interviews was placed before the Lord Chancellor in the course of the inquiry which he made at my request; and, as the House will remember, he reached the conclusion that there were no grounds for further investigation.
No new evidence of any leakage of information has been adduced. But in the course of the supplementary questions yesterday imputations were made—or, at any rate, implied—on the honour of my right hon. Friend the Chancellor of the Exchequer and on the character and probity of Mr. Oliver Poole. These are serious imputations, and my right hon. Friend and Mr. Poole have both represented to me most strongly that they should be given an opportunity to rebut them.
Mr. Poole, who is no longer in a position to defend himself in this House, has sent me a letter, which I will circulate in the OFFICIAL REPORT, asking that an inquiry should be held for this purpose. In the circumstances which have arisen, I have decided that this is now the right course to take. Therefore, I shall tomorrow move in this House, and my noble Friend will move in another place, for the setting up of a Tribunal of Inquiry under the Tribunals of Inquiry (Evidence) Act, 1921. Notice of motion will be given under the usual procedure.

§ Mr. Gaitskell
In view of the Prime Minister's decision to set up a Tribunal of Inquiry, it would clearly be inappropriate to pursue the matter further this afternoon. I would, however, like to ask him two procedural questions. First, will the tribunal sit in public? Secondly, what precisely will be the terms of reference—how wide is the scope of inquiry to be?

§ The Prime Minister
The terms of reference, will, of course, appear in the Motion that I will place upon the Order Paper, and, as soon as it is ready, I will see that a copy is sent to the right hon. Gentleman through the usual channels.
966 I would like notice of the first part of his question.

§ Mr. Gaitskell
In view of the importance of clearing up the matter in a satisfactory manner, I would ask the Prime Minister whether he would consider consulting the Opposition about the terms of reference and the scope of the inquiry?

§ The Prime Minister
No, Sir. This is a completely changed situation. This is now an attack on the honour of two gentlemen, and I think it right that they should have an opportunity to rebut this attack upon them, which, at an earlier stage, was mere tittle-tattle.

§ Mr. Gaitskell
Are we to understand from that reply that the inquiry will be limited simply to the particular imputations or allegations made regarding Mr. Oliver Poole, or will it be into the whole question of whether there was a leakage, and what exactly happened?

§ The Prime Minister
Perhaps the right hon. Gentleman will be good enough to wait until I have given him a copy—[HON. MEMBERS: "Answer."]—of the Motion that I propose to put upon the Order Paper. That must be upon my responsibility, and nobody else's, but, of course, it will be debatable tomorrow, and if the right hon. Gentleman and his hon. Friends are not satisfied with it they will be able to move Amendments to it.

§ Mr. H. Morrison
May I put it to the Prime Minister that my right hon. Friend's point is a very valid one? Presumably, the Prime Minister is now thinking about the terms of reference and, therefore, if the House were informed of the proposed terms that are in his mind, and we thought that they were inadequate, persuasion could be brought to bear upon him to amend them now. It would be much more difficult when the Motion was on the Order Paper.
Secondly, although I think I follow why industrial interests and commercial interests that were intimately concerned might have been informed—within strict limitations—I should like to know from the Prime Minister why the Deputy Chairman of the Conservative Party was brought into this privileged body of people, and given highly secret and confidential information. I am bound to say 967 that I never remember, on our side, representatives of the outside political Labour Party organisation being brought in to receive such information.

§ The Prime Minister
I am grateful to the right hon. Gentleman for his helpfulness. I will certainly consider, when drafting the Motion—which I have not yet completed—the point that he has made. I hope that the Motion will be found satisfactory to the House, but it must be made upon my responsibility. If it is not satisfactory, Amendments can, of course, be moved, but I will take the earliest possible opportunity of conveying the terms of the Motion, when we decide upon them, to the Leader of the Opposition, through the usual channels.
In reply to the second part of the right hon. Gentleman's question, this is, of course, a matter which is now one of discussion. What I am concerned with, and what I wish to rebut, is that any information on the raising of Bank Rate was given either to these or to any other gentlemen not Ministers or in the public employ.
When an imputation is made, as it was made by the right hon. Gentleman the Member for Huyton (Mr. H. Wilson) yesterday which is, in effect, an accusation not only that the truth was not told but that a most disgraceful act of corruption was committed by Mr. Poole—for that is the only point in saying that he had vast City interests—[Interruption.]—and since Mr. Poole points out to me that nobody is prepared to libel him outside the House of Commons, I think that it is only fair that he should have an opportunity of clearing his honour.

§ Mr. Gaitskell
Reverting to the first part of the supplementary question put by my right hon. Friend the Member for Lewisham, South (Mr. H. Morrison), will the Prime Minister be good enough to let us see the draft of the proposed Motion before it goes upon the Order Paper? I think it is far more desirable in a matter of this kind that, if possible, there should be agreement about the terms of reference. Of course, the Prime Minister takes the responsibility for those, but what we are seeking is an opportunity of giving an opinion upon them before he actually makes his decision.

§ The Prime Minister
I will consider that, but I am bound to say that after imputations of this kind have been made from the Opposition Front Bench I feel inclined to take the responsibility myself.

§ Mr. Gaitskell
I am sorry that the Prime Minister insists on taking this extremely high line about a matter which has been a source of very grave concern in the Press, and in the country generally. I have made, I should have thought, a very reasonable request to him, namely, that, if possible, we should agree on these terms of reference. I think that it is desirable, Mr. Speaker, that justice should not only to be done but should be seen to be done. I again press the Prime Minister and ask that we should have an opportunity of giving our views before the Motion is actually tabled.

§ The Prime Minister
I shall do everything that I can to get agreement, of course, but I think that the right hon. Gentleman is a little unreasonable. The object of putting the Motion on the Order Paper is that the House can debate it, and if he and his hon. Friends do not like it they can move an Amendment.

Mr. Glenvil Hall
I understand that the Prime Minister has not yet made up his mind whether to hold the inquiry in private or in public. May I press on him that it should be held in public, if the public at large and Members of this House are to be assured of the actual facts of what took place?

§ The Prime Minister
I will, of course, look into that. The only reason for my wanting a little notice is that I am not quite sure whether that lies within the control of the Government, and of the House, or of the judge himself. I should like to ascertain the facts on that. It is always dangerous to make a statement "off the cuff." I do not know the facts of that yet.