HC Deb 14 December 1965 vol 722 cc1090-2

The following Question stood upon the Order Paper:

53. Mr. J. H. OSBORN

To ask Mr. Chancellor of the Exchequer, what rate of interest applies to Her Majesty's Government's money due to residents in Rhodesia for pensions and now being held back.

The Chancellor of the Exchequer (Mr. James Callaghan)

With permission, Mr. Speaker, I will now answer Question No. 53.

In response to the humanitarian considerations involved, and in accordance with the advice received from the Governor of Southern Rhodesia, Sir Humphrey Gibbs, permission will again be given for payments from the United Kingdom of pensions due to residents of Rhodesia. The question of interest payments does not therefore arise. I should emphasise that this decision implies no change of policy in the tight and effective control that is being exercised over other financial transactions.

Mr. Osborn

Is the right hon. Gentleman aware that this announcement will be welcomed in Rhodesia by all those who are affected and that I thank him for changing his mind on this subject?

Mr. Callaghan

The control is bound to involve both dislocation and inconvenience in this country and in Rhodesia. In the special case of payments of pensions, I think it is right that humanitarian considerations should prevail.

Mr. Zilliacus

Does my right hon. Friend's statement mean that Service pensions will again be paid to policemen and officers, United Kingdom subjects, who are now serving in Ian Smith's forces?

Mr. Callaghan

It is not possible to make any administrative distinctions without setting up a large machine at this end, which, in present circumstances, I do not think I should be well advised to do. I hope that the pursuit of the other measures will ensure that Rhodesia will return to constitutional methods of Government before such a step is necessary.

Dame Irene Ward

While thanking the Chancellor for his change of opinion, may I ask him why it is that the Government always put the case of these kind of people, pensioners, at the bottom of the list of priorities?

Mr. Callaghan

That was not the criticism levelled against us from outside this country a year ago when one of the first steps we took on coming to office was to make a record increase in pensions.

Mr. Driberg

While allowing for the humane treatment of existing elderly pensioners, would my right hon. Friend at least make it clear that those people who are at present in die Civil Service and Armed Forces and who are continuing to serve the illegal régime in Rhodesia will forfeit their pension rights for the period from U.D.I. until constitutional government is restored?

Mr. Callaghan

I would not think it proper to give such an undertaking.

Mr. Heath

As this matter was raised from the Front Bench, may I join my hon. Friends in thanking the Chancellor for admitting frankly that this measure was a mistake and for putting it right?

Mr. Callaghan

I am always ready to accept that there are occasions when one is handling large events—and we have not handled an event as large as this for a long time—that in a general prohibition of payments events may take place which, on reflection, ought to be reversed. I am glad that we have now been able to do this, although I am sure that I have the support of the whole House in saying that the control of payments to and from Rhodesia should be very firmly administered.

Dr. Bennett

Since the Chancellor has been good enough to reveal his intention to relax this restriction on the civil pensioners, and since this arose during our debates on the Pensions (Increase) Bill, can he affirm that this restoration will also apply to Service pensioners?

Mr. Callaghan

As far as I know, it applies to all pensions, but I do not recall the particular point which was raised during our consideration of the Pensions (Increase) Bill. If the hon. Gentleman will write to me on the subject I will give him an answer.