§ 21. Sir C. Osborneasked the Chancellor of the Exchequer by how much approximately the overseas interest charge would be reduced per annum if the Bank Rate were reduced to 4 per cent.
§ Mr. BarberI assume my hon. Friend is referring to our interest liability on the overseas sterling holdings. I regret that it is not possible to assess such a figure with any useful degree of accuracy.
§ Sir C. OsborneSince this amount must run into scores of millions of pounds a year, is not this an unnecessary waste of public resources? What justification can there be for this continued high rate for the Bank Rate?
§ Mr. BarberMy hon. Friend is right in indicating that this is a burden on the balance of payments. On the other hand, as he knows, the level of the Bank Rate has to be fixed with a number of considerations in mind. The burden on the balance of payments is only one of them.
§ Sir C. OsborneWhy should we have almost the highest Bank Rate in the world?
§ Mr. BarberThe reasons for the considerable increase in the Bank Rate last July were given at that time by my right hon. and learned Friend. Since then, the Bank Rate has been reduced on two occasions and the reasons for that have been given by the Chancellor. Obviously, I cannot be drawn into making any predictions for the future. But I will say that, at Question Time, it is quite impossible for any Minister to give the full reasons which lie behind a particular Bank Rate.