SWISS LOAN AGREEMENT (Hansard, 18 December 1961)

§ The Lord Privy Seal (Mr. Edward Heath)
With your permission, Mr. Speaker, and that of the House, I wish to make a statement on the Swiss Loan Agreement.
The Swiss Loan Agreement, signed in Berne on 20th October, providing for a three-year loan of 215 million Swiss francs, was laid before the House on 15th December. I greatly regret the delay which occurred.
Under the Ponsonby rule it is customary for such an agreement not requiring parliamentary authority, but containing a ratification clause, to be laid before Parliament for a period of 21 parliamentary working days before it is ratified. The Swiss Loan Agreement envisages ratification, however, before the end of the year.
In these circumstances, the Government would propose to follow the precedent adopted on some previous occasions of informing the House that they intend to ratify an agreement, in this case before 29th December, 1961. It is hoped that the debate today on economic affairs and the debate on Wednesday on foreign affairs will give any hon. Members who wish the opportunity of expressing their views upon it.

§ Mr. Mayhew
But that means that, again, the Government have failed to lay an Agreement at the proper time. If 21 days are required, this Agreement should have been laid—[HON. MEMBERS: "Speech."] Is the right hon. Gentleman aware that if 21 days are required, this Agreement should have been laid on 10th December? This is another case of incompetence and muddle on the part of the Foreign Office.
May I ask the Minister how he accounts for this? What reason has he 941 for it? Is it that we are now so bankrupt, and we borrow so often from abroad, that the Minister has lost count of the number of treaties? Before the House lets this go by, the Minister should explain how this happened.

§ Mr. Heath
I congratulate the hon. Gentleman, on his first appearance at the Dispatch Box in his new capacity, on the great discontent that he has so readily shown about this incident. I have already apologised for the delay which occurred in the machinery for dealing with these agreements and placing them before the House before ratification. I hope that the House will accept that in these circumstances a valuable Agreement of this kind should be ratified and that hon. Members who wish to express views should be able to do so.

§ Mr. Grimond
I am sure that the House will not be content with this extraordinary statement. Is it not a fact that the Government have borrowed more for less reason than any Government since the war? Is it not also a fact that the Minister has given no explanation for the delay? Can he say what went wrong with the machinery in this case, as in so many others, that we could not have the Agreement in time?

§ Mr. Heath
As I have explained, there was delay in the machinery by which the actual Agreement came forward from the time of signing to the time of printing and laying before the House. In these circumstances, I hope that the House will accept this procedure for which there are precedents.

§ Mr. S. Silverman
On a point of order, Mr. Speaker. May we ask for your assistance? I understand that the purpose of the requirement that there shall be 21 days' notice is so that the House shall have an opportunity of considering the matter within the 21 days and deciding whether it wishes the Agreement to be ratified or not? If we are told only today that that period of 21 days is not being provided, and the right hon. Gentleman expresses the hope that hon. Members will be able to express their views on Wednesday, when we are to discuss foreign affairs on a Motion for the Adjournment, what possible opportunity will the House ever have to come to a decision on the matter?

§ Mr. Gaitskell
Further to that point of order, Mr. Speaker. Am I not right in supposing that the original doctrine on cases of this kind was laid down by Mr. Ponsonby when he was Under-Secretary of State for Foreign Affairs in 1924, and on that occasion he made it plain that when the Government negotiated an Agreement of this kind they would lay the Treaty on the Table of the House, and that it would not be brought into operation for 21 days to give time for the Opposition, if they so desired, to ask for a debate? Furthermore, Mr. Ponsonby went on to say that if the Opposition were to ask for such a debate the Government would readily agree to it. Am I right in supposing that? Can you confirm that my memory is correct?

§ Mr. Speaker
I hope it is, because I am not well enough equipped at the moment to support or not to support the right hon. Gentleman's proposition. I have no reason to doubt it. I think that the strict position is that this is a matter not for the Chair, but a matter of complaint as between the two sides of the House, and I must not be involved therein.

§ Mr. Mayhew
Mr. Speaker, may I he allowed to quote the statement which Mr. Ponsonby made on that occasion? He made his declaration in 1924 and, as I understand it, it has lasted since then without exception. He said: It is the intention of His Majesty's Government to lay on the Table of both Houses of Parliament every Treaty, when signed, for a period of 21 days, after which the Treaty will be ratified and published and circulated in the Treaty Series. In the case of important Treaties, the Government will, of course, take an opportunity of submitting them to the House for discussion within this period. But, as the Government cannot take upon itself to decide what may be considered important or unimportant, if there is a formal demand for discussion forwarded through the usual channels from the Opposition or any other party, time will be found for a discussion of the Treaty in question."—[OFFICIAL REPORT, 1st April, 1924; Vol. 171, c. 2003–4.]

§ Mr. Speaker
I am obliged to the hon. Member. It confirms my view that this is not a matter for the Chair.

§ Mr. Heath
That statement was one of intention of the Government of the day. It has been followed for the greater part of the time since then by Governments, but not for the whole time. There was a certain period when the 943 rule was not followed by the Government. In any ease, there have been to date about nine exceptions to this rule when Governments, for a variety of reasons, have informed the House that they intended to ratify in less than the 21 days which was the intention of the Ponsonby rule.
In these circumstances, in view of the value of this Agreement, I am expressing the hope, which, of course, we are prepared to discuss with the right hon. Gentleman and his hon. Friends, that the House will accept the Government's intention to ratify before 29th December.
In reply to the hon. Member for Nelson and Come (Mr. S. Silverman), as I said in my statement, it is hoped that today's debate will also provide an opportunity for hon. Members to express their views.

§ Mr. Gaitskell
Does the right hon. Gentleman's statement mean that the Government adhere to the Ponsonby declaration, that they are not trying to upset that in any way, and that although they should have published this Agreement and given us the opportunity within 21 days after the Agreement to raise the matter in the House, nevertheless they are not withholding that right from us now? Is the right hon. Gentleman further aware that as there are only a few days before the Recess time will have to be found to debate this matter before we adjourn on Thursday? In the circumstances, may I ask the Leader of the House whether he will find time for a debate on this matter tomorrow?

§ The Chancellor of the Duchy of Lancaster (Mr. Iain Macleod)
The position has been correctly expressed by both Front Benches. This was a declaration of intent in 1924. There has been a considerable number of exceptions to this, and my right hon. Friend the Lord Privy Seal mentioned nine. In view of what the Leader of the Opposition has said, we shall be quite ready to discuss the point that he has just raised—as my right hon. Friend the Lord Privy Seal said earlier.

§ Mr. Gaitskell
There is not much time to discuss this, if it is to be taken tomorrow, which appears to be the only possible day. In view of the fact that today's debate is concerned with the 944 economic policy of the Government at home, and Wednesday's debate with Berlin, will not the right hon. Gentleman agree forthwith to allow a debate on this matter tomorrow?
Is the right hon. Gentleman aware that although the Lord Privy Seal instanced a number of exceptions, the only particular cases that he mentioned were cases where the Government wished to ratify the treaty in a period less than the 21 days of the Ponsonby declaration? Am I not right in supposing that this does not explain the error of the Government on this occasion?

§ Mr. Macleod
Purely on the point of business—naturally, there are very few days left; that is obvious to all. I am not going to attempt to rearrange business across the Table. I would rather that we discussed it, and I am ready to do that as soon as possible.

§ Mr. Shinwell
May I ask a non-technical question? What do we want the money for? Is this a demonstration of the well-known saying, "You have never had it so good"?

§ Mr. Heath
This is obviously a matter for my right hon. and learned Friend the Chancellor of the Exchequer. It is the result of part of the arrangements made in the summer, which are well-known to the House.
In answer to the Leader of the Opposition, I confirm that it is the intention of the Government to adhere to the Ponsonby rule, and I have expressed my regret to the House for the delay which occurred in this case, and, in expressing my regret, I hoped that the House, seeing the Agreement laid on the Table, would find itself able to accept the Government's expression of regret and their intention to ratify it.

§ Mr. Mitchison
In the absence of the Chancellor of the Exchequer, can the right hon. Gentleman tell us whether this borrowing, at a cost of 3 per cent., is additional to the I.M.F. borrowing? The £100 million was repaid out of the International Monetary Fund at the end of October. This is about £17 million or £18 million, borrowed from the Swiss at 3 per cent. Why?

§ Mr. Heath
I have explained that this is a matter for my right hon. and learned Friend the Chancellor of the Exchequer. 945 If it will help the House and the hon. and learned Member, however, I can give the reason for the arrangement. It is that Switzerland is not a member of the International Monetary Fund, and, therefore, this was an additional amount. As it was outside the scope of the I.M.F. Agreement, a special Agreement was necessary.

§ Mr. Mitchison
But why at 3 per cent, interest when the I.M.F. loan is free?

Several Hon. Members
rose—

§ Mr. Speaker
Order. We have very much to do today, and I feel that we really ought to get on. Mr. Sandys.

§ Mr. Shinwell
On a point of order. When we are informed that a large sum of money is to be borrowed from another Government, surely it is in order to ask what the money is required for.

§ Mr. Speaker
There is no Question before the House, and we have to have regard to the number of hon. Members who wish to speak on business later today. We have other matters before we get to that. That was what was in my mind in attempting to carry out the usually difficult task of trying to find out when the House wants to stop a discussion.

§ Mr. C. Pannell
The Lord Privy Seal has asked the House, or the Opposition, for an act of grace towards the Government, and I find it difficult to see why, outside any normal procedure—or at least outside the procedure that has lasted for 30 years—we should accept, in a period of two or three days, something that the House has felt, with a proper sense, should wait for 21 days. To the first simple supplementary question thrown to him by my right hon. Friend the Member for Easington (Mr. Shinwell), the Minister answers that it is a matter for the Chancellor of the Exchequer. Does not this generally show not so much ignorance on the part of the Foreign Office—because apologies have already been made for its slip-up—as gross contempt of the House?

§ Mr. Speaker
I see no contempt of the House.

§ Mr. S. Silverman
On a point of order. May I respectfully draw your attention, Mr. Speaker, to the fact that, 946 quite apart from any question of the merits of the Agreement, which the House certainly would not be entitled at this moment to debate, there are certain procedural questions arising out of what the Lord Privy Seal said that have not so far been entirely cleared up? Would it not be in order to ask a supplementary question, so as to clear them up? I do not want to abuse the procedure of points of order, but would it not be proper for me to indicate to you the procedural question which I would have liked to ask, if you thought that it would not be debating the merits in any way?

§ Mr. Speaker
I do not think so. I do not understand how I can be used as what is now called a pipeline to ask a question of a Minister.

§ Mr. Gaitskell
In an effort to try to clear up the matter, the Leader of the House has said that he is prepared to discuss with us the question of a very early debate on the matter. That is all right, subject to one anxiety in our minds, which is that unless we have a debate tomorrow it will be too late, because the only other day on which we could have the debate would be Wednesday. [HON. MEMBERS: "Why not Friday?"] If hon. Members opposite wish to take an extra day, so much the better. We are much obliged to hon. Members opposite. No doubt they will bring pressure to bear upon the Government in respect of this matter as they have done in respect of so many others. But how are we to be sure that we shall have an opportunity to debate the matter, in view of the lack of time, unless we get an immediate answer from the Leader of the House?

§ Mr. Speaker
I am not in a position to dictate what the Leader of the House should answer, as the right hon. Gentleman knows.

§ Mr. S. Silverman
On a point of order. I am sorry to be persistent, but references have now been made, by both Front Benches, to discussions between the usual channels on the question whether or not an opportunity will be provided to discuss this matter before 29th December. I am not represented in any of these usual channels and it therefore seems to me that, unless some provision is made for consultations all round, the 947 only opportunity I will have will be to ask my supplementary question now.
But I cannot do that unless you will permit me to do so, Mr. Speaker. If you do not permit me to do so it means that I shall have no opportunity whatsoever—and neither will my hon. Friends—of taking any part in discussing the question whether there shall be a discussion or no discussion before ratification, irrevocably, has taken place.

§ Mr. Speaker
Supposing some agreement to be arrived at through the usual channels, an announcement of the substance of the agreement would be made in the House. I assume that the hon. Member would then probably have an opportunity of asking a question about it, and possibly of expressing, by way of such question, his agreement or disagreement with what had been agreed. I am not in a position to help the hon. Member to be more intermingled with the usual channels.

§ Mr. Silverman
With great respect, Sir, I cannot think that the position is satisfactory for unofficial Members of Parliament—Members who are not represented in what are euphemistically called the "usual channels".
The usual channels are intended to be representative of all bodies of opinion in the House, and they all ought to be included or else this consultation should not take place at all. If there is to be private consultation, those other groups ought to be represented. If that cannot be done, the discussion ought to take place on the Floor of the House of Commons.

§ Mr. Speaker
I confess that I had a little difficulty in hearing all that the hon. Gentleman was then saying to me. What I did hear was the answer already given to a question addressed to the Leader of the House. I cannot think that a repetition of the substance of that question would be in order.