HC Deb 11 December 1962 vol 669 cc211-6
The Joint Under-Secretary of State for Foreign Affairs (Mr. Peter Thomas)

With your permission, Mr. Speaker, and that of the House, I wish to make a statement about the Government's proposals for the settlement of Egyptian claims.

Right hon. and hon. Members on both sides of the House have asked that this statement should be made before the Report stage of the Foreign Compensation Bill, which will be tomorrow.

The Government have five proposals. First, we propose to lay before the House a new Order in Council that would provide that compensation on assessed claims against the Egyptian Compensation Fund should be paid on the following increased and final scale: on the first £10,000 of each claimant's assessed losses, 100 per cent.; on the next £40,000, 75 per cent.; on the next £450,000, 50 per cent.; on the next £500,000, 30 per cent.; on the next £1 million, 25 per cent; and on the part of any claim exceeding £2 million, 20 per cent.

This new scale will give a 100 per cent. payment to over 90 per cent. of the claimants and substantial increases to all the other categories up to £2 million. Claims exceeding £2 million will also benefit by the increased percentages on the lower parts of their claims. We estimate that to enable the Foreign Compensation Commission to pay compensation on these scales, Her Majesty's Government will need to pay into the Egyptian Compensation Fund about £5,500,000.

Secondly, we propose to lay before the House an Order in Council that will enable the Foreign Compensation Commission to pay on the same scale claimants in respect of certain additional claims, which, although arising out of the Suez incident, could only be registered but could not receive compensation under the Orders in Council following on the Anglo-United Arab Republic Financial Agreement of 1959. We estimate that this will require approximately a further £1 million.

Thirdly, we propose that the balance of approximately £33,000 by which the compensation paid by the United Arab Republic for the British officials dismissed in 1951 fell short of the sums advanced to the Officials' Association by Her Majesty's Government should be written off.

We further propose to waive the repayment of £8,904 advanced by Her Majesty's Government to the Association for the payment of legal expenses, and, as a final settlement, to make an additional grant to the Association of £200,000. As it is proposed to make this payment without delay an advance will be obtained from the Civil Contingencies Fund and Parliament will in due course be asked to vote the amount by means of a supplementary estimate.

Fourthly, we have carefully considered the difficulties of those British nationals who were obliged in 1956, at very short notice, to abandon their property in Egypt, where it was then sequestrated. This property—much of which is not in liquid form—has now been desequestrated, and in most cases returned to its owners or their agents, and they still remain its legal owners. But the majority of them cannot use their property or derive any benefit from it—apart from the first £5,000 Egyptian which they can now transfer to this country.

We propose to make available up to £2½ million to relieve, by way of grants, cases of comparative hardship among these persons, as well as to assist with certain other kinds of claims, such as compensation for severe personal injury, that will not be eligible for compenation out of funds distributed by the Commission.

Fifthly, we propose to allocate up to £500,000 for grants towards the payment of agents' fees and expenses by owners of desequestrated property who have had to employ agents to negotiate the release of their property and the transfer of assets.

We propose to set up an independent committee to investigate cases of hardship among owners of immobilised assets and to make recommendations for grants.

Mr. Mitchison

I trust that I shall not take up the time of the House unduly on this occasion. Is the hon. Gentleman aware that these claims arise in special circumstances? They are being met from British funds because the Government recognise their responsibility for the Suez adventure and these are claims coming from that adventure. In those circumstances, since the United Arab Republic has contributed £27½ million, does not the hon. Gentleman think that the British Government are being a trifle stingy with some of these claims in Limiting what is now offered to around £10 million, if I get the figures right, particularly in the case of the dismissed officials, with whom Her Majesty's Government would be wise always to have sympathy, and also in the case of those who have sequestrated assets in Egypt and who, even when those assets are in liquid form, are finding great difficulty and delay in getting them to this country?

I trust that there will be opportunities of discussing the matter in more detail at later stages on the Bill and on the Orders in Council which have been foreshadowed. Is the hon. Gentleman able, however, to assure the House that when he comes to these matters he will consider the possibility of full compensation in at least some of these cases because of the Government's ultimate responsibility for the whole incident?

Mr. Thomas

I am sure that the hon. and learned Gentleman will forgive me if I do not enter into debate with him over the Suez incident. The Government are anxious to have a fair and reasonable settlement of these claims and to meet hardship wherever necessary. The hon. and learned Gentleman will not, therefore, expect me to agree with him when he describes these very reasonable, and, in some cases, very generous, terms as being stingy. The hon. and learned Member will appreciate that the dismissal of the 1951 officials has nothing to do with the Suez incident.

As to the question of debating these issues, as the hon. and learned Member knows Orders will have to be laid before the House and the relevant Order on the Egyptianisation claims and the sequestration losses will be subject to the affirmative Resolution procedure and, therefore, will be debatable.

Mr. Hirst

In thanking my hon. Friend for his promised statement, may I ask whether the £5½ million which he has mentioned will be distributed in addition to the total amount now remaining in the fund at present undistributed and whether he can give a total figure? May I ask, secondly, whether this is the final answer and whether there will be further allocations of sums in the future, as there still remains unfairness to the much larger claims, which in many instances are those of companies with small shareholders and not, as might appear to be the case, single owners?

Thirdly, do the additional claims include sums that were deposited in Egyptian banks for the payment of assets sold to Egypt before the Suez venture, but 'which, because of it, the Egyptian Government have never remitted?

Mr. Thomas

In reply to my hon. Friend's first question, the £5½ million will be in addition to sums already in the Foreign Compensation Fund. This Fund, which originally was £27½ million, rose to about £29¾ million. Therefore, the total sum which will be used for the payment of Egyptianisation claims and sequestration losses will amount to £35 million.

My hon. Friend asked, secondly, whether this was the final answer. My answer to that is, "Yes". It is intended that this shall be a final settlement of the Egyptian claims.

If my hon. Friend looks at the figures he will see that the larger claimants will benefit by the increased scales below the £2 million figure. Under the new scale, a £2 million claimant, for instance, will receive £176,000 more than he would have received under the old scale. It is, however, the smaller and needier claimant whom we have had in mind in working out these proposals, since these people are hardest hit by the losses which they have sustained.

I could not answer my hon. Friend's last question with any degree of accuracy without notice.

Mr. J. T. Price

The hon. Gentleman has stated that a further bill of approximately £10 million is to be met by the taxpayer in respect of the Suez adventure and all that flowed from it. If this is the final settlement, can the Under-Secretary tell the House what is the total amount of money which has been disbursed by the Treasury in respect of all the expenses flowing from Suez? Will he also tell the House what he imagines would be the position of, for example, a borough or urban district council, faced with a public auditor, when large sums of indebtedness have been incurred at the expense of ratepayers? Would not such an authority be surcharged by the public auditor?

Mr. Speaker

The surcharge of local authorities does not lie within the realm of responsibility of the Under-Secretary of State.

Mr. Maxwell-Hyslop

Concerning the 1951 officials, will the extra £200,000 be distributed among the remaining spouses of deceased claimants? Secondly, is my hon. Friend aware that one can give only a somewhat melancholy welcome to a total of £400,000 eleven years after the claims which, in 1951, totalled £660,000?

Mr. Thomas

I could not answer my hon. Friend's first question without notice but I will find the answer and let him know.

As to the second part, the figure of £660,000 was the maximum figure which was submitted by the Officials' Association, not to Her Majesty's Government, but to the Egyptian Government, as a basis for negotiating the compensation claim. Her Majesty's Government were not called upon either to approve or to contest it. We consider that the settlement which we are now proposing, which is, in effect, a grant of £244,000 in addi- tion to the £165,000 which has already been received from Egypt, is not only eminently reasonable, but is as generous as is possible in the circumstances.

Sir H. Oakshott

Particularly on the question of persons falling within the second and fourth of the Government's proposals, can my hon. Friend say how long this will all take after approval of the Orders in Council? He will be aware that there have been considerable delays in the past. Will he give an assurance that these delays in assessment, approval and payment of claims will be cut to the minimum?

Mr. Thomas

Yes, Sir. I certainly give my hon. Friend that assurance.

Mr. Mitchison

Will the Under-Secretary answer my hon. Friend's question: What is the whole cost of Suez now?

Mr. Speaker

Order. We must try to confine ourselves to the business in hand so that we do not consume too much of our time for other matters.