HC Deb 18 April 1967 vol 745 cc441-90

10.27 p.m.

The Minister of State for Commonwealth Affairs (Mr. George Thomas)

I beg to move, That the Southern Rhodesia (Prohibited Trade and Dealings) (Amendment) Order 1967, dated 15th March 1967, made by Her Majesty in Council under the Southern Rhodesia Act 1965, a copy of which was laid before this House on 15th March, be approved. This Order is an essential step to tighten up the enforcement machinery of our existing sanctions. It is a reminder to the people of Southern Rhodesia, both black and white, that until legality is restored there the sanctions grip will get tighter and tighter.

A little while ago the Government's attention was drawn to the risk of United Kingdom persons and companies being involved in transactions which, though they were not themselves forbidden by our existing legislation, might well facilitate the contravention or evasion of that legislation. Having regard to our obligations under the Security Council Resolution, it was essential therefore for us to take whatever steps we could to prevent our nationals and companies from being parties to such transactions.

The central provision of this Order is in Article 3 which amends the Order of 1966 by inserting in it a new Article, to be numbered as Article 8A. The House will see that this confers powers on the Secretary of State in relation to the transfer of the ownership of certain property overseas where it appears to him that such transfer might facilitate the contravention or evasion of the Order of 1966, or of the Petroleum Order of 1965.

The property in question is property in which persons who are subject to the Article—

Mr. Speaker

Order. Perhaps the hon. Member will help me. Is he moving the second Order, rather than the first one?

Mr. Thomas

I beg your pardon, Mr. Speaker. I moved the Order dealing with prohibited trade and dealings, and you did not correct me at the time. Would you like me to deal with the other Order first.

Mr. Speaker

Perhaps the hon. Member would deal with the Orders in their correct order.

10.30 p.m.

Mr. George Thomas

I beg to move, That the Reserve Bank of Rhodesia Order 1967, dated 23rd March 1967, made by Her Majesty in Council under the Southern Rhodesia Act 1965, a copy of which was laid before this House on 31st March, be approved. I am sorry about the confusion, Mr. Speaker. Both Orders are equally good.

This Order amends the Reserve Bank of Rhodesia Order, 1965, which, as the House will recall, was made in December, 1965, and approved by Parliament in the same month. The Reserve Bank of Rhodesia established in 1964 by an Act of the Southern Rhodesia Legislature entitled the Reserve Bank of Rhodesia Act, 1964. This provided for the affairs of the bank to be run by a board of directors consisting of a governor, a deputy governor and no fewer than nor more than seven other directors.

After the illegal declaration of independence in 1965, it was thought necessary, as the House will recall, to take steps to prevent the then existing board of directors of the bank in Salisbury from continuing to exercise authority in the name of the bank, in particular as regards the fairly large accounts held by the bank outside Southern Rhodesia. Accordingly, the Order was made in December, 1965.

That Order suspended from office persons who immediately before the commencement of the Order were the governor, the deputy governor and other directors of the Reserve Bank. The Secretary of State was empowered, so long as the Order remained in force, to appoint other persons to be the governor, deputy governor and other directors of the bank. Persons so appointed were to constitute for the time being the board of directors of the bank. The governor appointed was Sir Sydney Caine, who has served with great distinction, and the other directors were Viscount Harcourt, Lord Poole, Sir Norman Kipping, Sir Gordon Munro and Sir Siegmund Warburg.

The primary function of the board thus appointed was to locate and then assert its authority over the external assets of the Reserve Bank. The purpose of this was to prevent the illegal régime from applying them towards the furtherance of the rebellion and to preserve them for the people of Rhodesia as a whole pending the restoration of constitutional government. The operation of locating and preserving the external assets of the bank having thus been completed, it was decided some time ago that it was no longer necessary to maintain a full board of directors of the bank. [Laughter.] If hon. Members opposite will contain themselves for a moment, they will discover that the Order before the House makes adequate provision for the appointment of a Governor and Trustee, which is his title, to fulfil the duties which have hitherto been completed by the governors of the bank.

I should like to pay public tribute to the high sense of duty of Sir Sydney Caine and his colleagues, who have given distinguished service and who have taken no remuneration for their public services while acting in this responsible capacity.

Mr. Hugh Fraser (Stafford and Stone)

How successful were they?

Mr. R. T. Paget (Northampton)


Hon. Members

Give way.

Mr. Thomas

I have given way to my hon. and learned Friend before, to my sorrow.

The Governor and Trustee is empowered, and in a sense, required, to take such steps as seem to him necessary or expedient to carry on the business of the bank, or to enable it to be carried on. It is probable that when the time comes for the lawful government to be restored in Rhodesia there will be a transitional period when this provision becomes of major importance.

There are just two other comments that I would add. The first is to explain that, though I have said that the desirability of making this change was realised before the end of last year, and was agreed with the then existing board, the process of putting the change into operation was overtaken by the litigation in the German High Court, over the bank notes, which the illegal régime in Rhodesia was seeking to have printed and exported to Rhodesia for its use. In order to avoid confusing this litigation, it was agreed by all concerned that it would be desirable to postpone this change until that matter had been disposed of. Hence the fact that the Order was not made until the end of last month.

The second comment is to reiterate the deep gratitude we feel to those who have served as directors—and I include Sir Gordon Munro, who retired some time ago, due to ill-health, but who gave invaluable service. When lawful government is restored and happier times return to Rhodesia, the funds of the Reserve Bank will be available for the purpose or rebuilding and restoring the prosperity and sound financial position which Rhodesia formerly enjoyed.

I hope that the House will register its approval of this Order tonight in the knowledge that we are giving a message to the people of Rhodesia that—[Interruption.]—I have already said to the black people and the white people that we are determined to see that the machinery of sanctions operates successfully.

Sir Knox Cunningham (Antrim, South)

On a point of order. Is this the only Order that we are discussing, or is The Southern Rhodesia (Prohibited Trade and Dealings) (Amendment) Order 1967, which has already been moved by the Minister being discussed with it?

Mr. Deputy Speaker (Sir Eric Fletcher)

This is the only Order being discussed at the moment.

Mr. Richard Wood (Bridlington)

The hon. Gentleman has explained, fairly briefly, the purpose of this Order under which, I understand, the governor and trustee will replace the governor and board of directors and also provision is made for an alternate to the governor and trustee. I think that we are entitled to a little more explanation from the hon. Gentleman as to why this change is necessary. Why, in his own words, has he now discovered that it is no longer necessary to maintain a full board?

We understand from the Order that Sir Sydney Caine will continue. I should like to ask when are we likely to have an announcement about the alternate to Sir Sydney Caine? Before we part with the governor and directors of the bank, it would be appropriate—and I am sure that my hon. Friends would like to know how successful the Reserve Bank has been in what was presumably its primary objective, the control of Rhodesian Government reserves under the control of the Reserve Bank? These amounted, I think, to about £22 million at the time of the declaration of independence.

The hon. Gentleman skirted rather briefly round the German question, but we should like to know what the outcome was of the dispute over the Rhodesian banknotes printed in Germany. If, as it appears, there has been a settlement and the notes remain in Germany, what compensation was paid for this action? My hon. Friend the Member for Haltemprice (Mr. Wall) asked the Chief Secretary a week ago: … what has been the final result of action … in Germany …; and what has been the total cost of this operation. The Chief Secretary replied that … the banknotes will not be delivered to Southern Rhodesia except on the directions of the Reserve Bank of Rhodesia. No significant charge on public funds has been involved."— [OFFICIAL REPORT, 11th April, 1967; Vol. 744, c 154–5.] We should like to know the exact charge that has been involved, because then we may be able to judge for ourselves whether it is significant or not.

There are some other questions to be asked before the board passes out of existence. Was the board ever given legal recognition abroad, and, under its new management, what recognition will the Reserve Bank of Rhodesia receive? Secondly, are we to receive any report of the board's activities in the last 18 months?

A question of greater importance, and of great interest to a number of my hon. Friends, is: will the hon. Gentleman take the opportunity to clarify the present position about the payment of interest on Rhodesian stocks? I understand that the last payment was on 21st November, 1965. The bulk of the £67 million stock outstanding is held in London, and the interest in a full year is about £3¼ million. Some of the stock was due for redemption last year, but has not been redeemed.

The original prospectus for the stock contained a disclaimer for any responsibility by the British Government for interest or redemption, but surely this position has been changed since the dis- missal, by the Governor, of the Rhodesian Government, and the appointment of the new board of the Reserve Bank of Rhodesia, the arrangement which is now to be modified by this Order.

In December, 1965, my right hon. Friend the Member for Flint, West (Mr. Birch) asked the Secretary of State for Commonwealth Relations … why, although by virtue of the Southern Rhodesia Act 1965 he has power to direct the payment of interest on Rhodesian public debt in this country, he has permitted default. The then Commonwealth Secretary replied that the United Kingdom … have not assumed the government of that country and have not in any way succeeded either to the assets or to the liabilities of the Government of Southern Rhodesia."—[OFFICIAL REPORT, 14th December, 1965; Vol. 722, c. 233–4.] But on 15th November, 1965, the Attorney-General said: … the Government of the United Kingdom maintains responsibility and jurisdiction in respect of Rhodesia."—[OFFICIAL REPORT, 15th November, 1965; Vol. 720, c. 689.] In view of the fact that the Reserve Bank of Rhodesia in the last 18 months must undoubtedly have gained control of some of the assets held by the original board, can the Government really claim that the bank, either under its present or its future management, has no responsibility whatsoever for paying interest on these stocks? Can interest not be paid out of reserve funds held by the Reserve Bank in this country? As the Minister of State will be aware, there are a number of cases of hardship among those who bought Rhodesian stock in good faith and have not received any interest on it.

Moreover, the Government have accepted some responsibility for the damage to the Zambian economy caused by U.D.I. and have put forward nearly £14 million for development of new routes. It is illogical simultaneously to refuse to recompense citizens of the United Kingdom for comparable damage they have suffered. Whatever the legal niceties, it is incontrovertible that the British Government have assumed responsibility for the Government of Rhodesia and the hon. Gentleman can hardly argue that the Reserve Bank of Rhodesia is not under the control of the British Government in view of this Order.

The main Order—No. 2049—which, in 1965, appointed the Governor and Directors of the Bank, was part of the first sanctions imposed by this country after U.D.I. Those sanctions remained at that time firmly under the control of the British Government and the Conservative Party on that occasion did not oppose the Order. But we really must press the hon. Gentleman to take this opportunity to answer the serious questions I have put and those which no doubt my hon. Friends wish to put.

10.46 p.m.

Mr. R. T. Paget (Northampton)

As one who deplores action taken to injure the economy of Rhodesia, upon which both the black and the white Rhodesians live—and injury to an economy is always hardest upon the poorest section of the population which, in Rhodesia, is, of course, the black—I found it difficult to oppose the original Order which, so far from injuring the Rhodesian economy, conferred a great benefit upon it. This was because the Order had the effect of seizing between £8 million and £11 million of assets and relieving over £18 million of liabilities. It seemed to me to be some compensation to the Rhodesians in the circumstances.

Whilst I deplore injury to the Rhodesian economy, I equally deplore injury to our own. After all, if we are to be a world financial centre, it is important that the world should feel that we act as bankers and financiers rather than as politicians. The extent of the damage, for instance—and here I must plead an interest as a Lloyds underwriter—which we have done to our world insurance business by defaulting—

Mr. Deputy Speaker

Order. I must remind the hon. and learned Gentleman that the scope of the debate on this Order is very limited. We are merely concerned with the provisions of this Order for the appointment of the Governor and Trustees of the Reserve Bank of Rhodesia. We cannot enter into a general discussion of sanctions.

Mr. Paget

I entirely agree, Mr. Deputy Speaker. I was merely seeking to indicate the various aspects in which this sort of performance injures our own credit. I referred simply as a passing example to insurance. The same applies to banking. There is also the injury that has been done to the credit of the Commonwealth as a whole.

Mr. Deputy Speaker

Order. We cannot go into the question of injury to the credit as a whole. We are concerned merely with the constitution of the Reserve Bank of Rhodesia.

Mr. Paget

The right hon. Member for Bridlington (Mr. Wood) referred to Rhodesian bond holders and our failure to meet that obligation, and that was the point with which I was dealing. I was saying that, when one fails to meet the obligations of a Commonwealth loan—this is the first Commonwealth default—one is doing grave injury to the credit of an institution in which our national interest is involved. I therefore hope, as I have all along, that this Rhodesian folly can be wound up as soon as possible.

10.56 p.m.

Mr. John Biggs-Davison (Chigwell)

The Minister of State is a compassionate man and he cannot have liked the message which his brief commanded him to deliver to the people of Rhodesia, white and black: that the screw would be tightened, that sanctions would be intensified—

Hon. Members

Hear, hear.

Mr. Biggs-Davison

Hon. Members may say "Hear, hear," but—

Mr. George Thomas

I trust I said, "Until legality is restored."

Mr. Biggs-Davison

The policy which the hon. Gentleman is putting forward is that unemployment and want should be created and misery spread throughout Rhodesia until the Rhodesians submit to the will of him and his right hon. Friends. This reminds me of words used by Chatham in a not dissimilar situation: You may ravage but you will not conquer. The Order is worthier of "Alice in Wonderland" than of a responsible British Government.

The so-called board which has been set up has been from the start a farce, upon which the Government are now apparently ringing down the curtain. The hon. Gentleman paid tribute to the members of the board. I do not dissent from that. They deserve the sympathy of the House for having made themselves utterly ridiculous by assuming the duties which the Government put upon them.

Apparently, Sir Sydney Caine is now to be governor and trustee. We may ask, what has he done? What has the superseded board done? One thing Sir Sydney did, shortly before Christmas, he instituted civil proceedings in Germany and obtained the temporary injunction to restrain the printers, and South African Airways and British European Airways, from dispatching 28 tons of banknotes to Salisbury.

The notes were signed by a Mr. Bruce, who is described as Governor of the Reserve Bank of Rhodesia. The difference between him and Sir Sydney Caine is that Mr. Bruce, however illegal, has a bank to govern and a board to preside over. On 27th January, Dr. Adam, who was chairman of the civil court in Frankfurt, decided that the British Government's decision to appoint the board which is now to be dissolved had but one aim, to dissolve the board in Salisbury. I do not think that that object has been achieved.

The judge went on to say that the board in London which is to be dissolved could only be described as the legal custodian and not as the responsible administrative body of the bank. The court therefore decided that the export of these notes could be permitted. It went on to say that this did not mean that it acknowledged the Rhodesian régime to have legal authority. I do not know how this case will end, but the fact remains that the court in Germany has thrown doubt on the whole basis of the London board and I therefore ask whether this is the reason why this board is to be dissolved by this Order. This case in Germany is one of the factors which is paving the way for the international recognition of independent Rhodesia.

10.56 p.m.

Mr. Paul B. Rose (Manchester, Blackley)

The hon. Member for Chigwell (Mr. Biggs-Davison) seemed to be advancing the extraordinary proposition that Her Majesty's Government should give up assets to a rebellious and illegal régime against which we are at present applying sanctions under the auspices of the United Nations. It is strange that when assets belonging to such a régime are held in this country, the hon. Gentleman should be suggesting that we should gratuitously give them away. I trust that, having made a speech of that sort, he will follow his conscience and vote against the Order.

Her Majesty's Government are only doing what they are obliged to do; namely, to prevent the illegal régime from using these assets because they are assets which must be preserved not only for the 5 per cent. of Rhodesians who at present hold sway in Rhodesia—a régime which employs censorship and all the other well-known totalitarian methods to survive—but for the people of Rhodesia as a whole; the 95 per cent. as well as the 5 per cent.

My hon. and learned Friend the Member for Northampton (Mr. Paget)—with whom, as I have said in the past, I share a room in the House but whose views on Rhodesia I could not possibly share—said some time ago that sterling would suffer as a result of our action, but sterling seems to be riding high. My hon. and learned Friend has provided no evidence for his propostion and all the evidence shows that, far from what he described would happen, other countries recognise our international obligations and why we are taking this action. The standing of sterling and of Britain in the world would fall if we did not take this stand, and that is why I cannot accept my hon. and learned Friend's proposition.

As for the civil proceedings in Germany, we are only doing what we must do in respect of what are, in effect, forged and illegal notes produced by an illegal régime. If Chigwell were to declare independence and produce its own bank notes, that money would be regarded as illegal tender and my right hon. and learned Friend might decide to take suitable action over the forgery that had taken place.

Mr. Biggs-Davison

The German court did not take that view in respect of forged bank notes.

Mr. Rose

The fact remains that the illegal régime has no right in law to produce bank notes of its own. The fact is that, although the hon. Gentleman's friend may have a bank in Rhodesia, he has that bank only by virtue of an illegal action. It is a bank which he holds because it has been taken over by a régime which cannot be recognised and has no validity. There again, Her Majesty's Government are only doing what they have to do in the interests of international law.

I trust the right hon. and hon. Members on this side of the House, with one hon. and learned exception, will have no hesitation in approving the Order and the philosophy behind it.

11.0 p.m.

Mr. Hugh Fraser (Stafford and Stone)

The hon. Member for Manchester, Blackley (Mr. Rose) has shown a proper respect for the law, but hardly for the realities of the situation, and that shows the absurdity of the position in which the Government find themselves. They have appointed a distinguished body of people who seem to have done nothing. I hope that, before the end of the evening, we shall find just what they have done. They are now to be dismissed, and one man is to be left in charge. But the balance which must be struck is one between the absurd position into which we are moving and the losses to this country caused by sanctions on Rhodesia. I know that this is outside the precise order of the debate, but it must be borne in mind when the House measures how ludicrous this procedure is.

The hon. Gentleman almost gave the impression that, by this action, we have prevented any form of banking taking place in Rhodesia, but that is far from so. The Rhodesians seem to be conducting their banking without the help of Sir Sydney Caine and his distinguished colleagues, who perhaps occasionally communicate their highly intelligent comment to them, almost better than the Bank of England. The Rhodesian pound today is at par. Frequently, the Chancellor of the Exchequer comes here and says with great excitement, "One point over", or "One point under", gilts go up, everyone gets very excited, and Government morale rises. But in Rhodesia, the pound is at par. What is more, the Rhodesian travel allowance, which is not being prevented by the machinations of Sir Sydney Caine, Lord Poole, Mr. Warburg, Uncle Tom Cobley and other distinguished gentlemen in the City, is £150. One cannot help comparing that with the British travel allowance of £50. Rhodes- ians travelling out of their country are allowed £150, without a question being asked, and businessmen can have any amount. That is a measure of the absurdity which this Government are piling on the House and on our people by pursuing a policy which clearly has already broken down.

11.4 p.m.

Mr. Stephen Hastings (Mid-Bedfordshire)

The hon. Member for Manchester, Blackley (Mr. Rose), who felt that he had a sense of duty to speak up from the benches opposite—the only hon. Member to do so so far—pointed out two matters. He referred, first, to the number of countries who were supporting the Government's policy. I wish that he had the opportunity to go to Rhodesia and walk into Meikles Hotel on a Saturday afternoon, and discover how soon it was before he heard a word of English spoken. Whether they are on holiday or not, I do not know, but it is full of people speaking French, German, Japanese, Italian, and so forth, and one assumes that they have something to do with Rhodesian trade.

The second point which he made was answered effectively by his hon. and learned Friend the Member for Northampton (Mr. Paget). The reason why we are not going to follow our consciences into the Lobby against this Order is that we do not really—[Interruption.] The effect of the Order is to make sure that Rhodesia does not have to service her assets in overseas debts.

The Minister of State, with his usual amiability, expressed a point of view which I doubt whether he can find it in his heart to believe. He did it as nicely as we are accustomed to hearing him do it. The questions he has been asked are effective ones. We on this side hope that they will be answered before the debate ends.

There was a governor and there were directors. They have been referred to by name. They are to be replaced by a governor and trustee, which presumably means that there is not any longer any point in keeping the board going. What have these distinguished people been doing during the time they have been responsible or the Minister holds they have been responsible for the affairs of the bank?

The new Article 3(f) reads: it shall be the general duty of the Governor and Trustee"— that is, the person who has been substituted for the board— to take such steps as may appear to him to be necessary or expedient for the purpose of preserving and protecting the property of the Bank wherever such property may be found"— it is to be found principally in the form of real estate in Salisbury— and for the purpose of preventing unauthorised persons from acting or purporting to act on behalf of the Bank or from disposing of the property of the Bank or from acting in any way in a manner prejudicial to the interests of the Bank. The bank is physically located in Salisbury. The premises of the bank are in Salisbury. The bank is at this moment being run by Mr. Bruce. It is being run very efficiently. How does the Minister of State suppose that the new arrangement will in any way differ from what existed before?

Perhaps I am in no position, any more than the Minister is, to produce a fact or figure about the conduct of the bank's affairs, but I would hazard the guess that the bank's affairs are being well conducted and that the position is roughly this. Exports and re-exports for 1966 amount to £97 million. Imports into Rhodesia amount to about £85 million, leaving a favourable visible balance of about £12 million. Gold production in excess is about £7 million, which means an improvement in Rhodesia's balance of payments of about £19 million. Taking the invisibles which are the direct result of the Order, there is an immediate improvement of about £15 million, which means the interest and dividends on foreign investment. Therefore, for 1966, if my figures are correct, Rhodesia will finish with a surplus of about £7 million on current payments. If this is so, nobody can say that the affairs of the Reserve Bank are being conducted in a way which is any way harmful to the interests of Rhodesia at the moment. I do not know what the governor and trustee will do about it or what effect he will have. If what I have recited is untrue, I hope that we shall have a denial, or at least an explanation of why the governor and trustee is to be appointed.

The new Article 3(e) provides: the Governor and Trustee and the Alternate to the Governor and Trustee shall hold office upon such conditions as to remuneration and allowances as may from time to time be determined by the Secretary of State after consultation with the Governor and Trustee". What consultations have taken place so far? The Minister of State told us that the governor and directors had done their work for nothing, whatever work they have done. Are there to be more consultations about the duties of the governor and trustee and the alternate to the governor and trustee? What does the governor and trustee reckon his job is worth? If this passage means anything, we should have an explanation. All the speeches made by my right hon. and hon. Friends show up the debate for the charade it is. There is no other purpose in bringing these things forward.

The Order forms part of a policy which we on this side, all jokes apart—and this is a joke; let us make no mistake about it—regard as a disaster, as an irresponsible idiocy, a policy which our grandchildren will look back on and wonder what took the Government of this country at this time to present to us something which will damage our interests and those of the people involved in Rhodesia to the extent that it does.

11.10 p.m.

Mr. Ronald Bell (Buckinghamshire, South)

I am not surprised that the Minister of State moved the other Order by mistake. There is at least something to be said about the other Order, which is a rather significant one, and I understand why he wanted to get on with that.

The Order which is before us is a mixture of farce, paradox and tragedy—tragedy, as the hon. and learned Member for Northampton (Mr. Paget) indicated, because of the damage that it and its predecessors together do to British financial reputation in the world. This mixture of banking and politics, banking and vindictiveness, is thoroughly damaging and thoroughly unworthy of this country, which has for so long been the centre of financial transactions in the world. By these Orders, we have given notice to everyone, of every country, that everything is subservient to Government policy and that we shall not hesitate to lay our hands on other people's money if we think that it will advance the immediate short-term policies of the Administration in this country.

It is a paradox because, as some of my hon. Friends and the hon. and learned Member for Northampton have pointed out, the effect of the Order and its predecessor is simply to confer a financial benefit upon the Government of Rhodesia, and it is a farce because these distinguished gentlemen have been made monkeys of by the Prime Minister here. The whole reason for the Order is that all but one of them are unwilling to occupy so ridiculous a position any longer.

One can be misled by the Explanatory Note to the Order. The Order is not merely to replace the governor and the board by a single governor and trustee. The amending Order is about twice as long as the principal Order because it sets out in considerable detail the function which the governor and trustee is to fulfil.

The principal Order of 1965 could be short because it merely said that the governor and the directors appointed under it would exercise the functions of the board of the bank under the Southern Rhodesia Act. The present Order not merely replaces the governor and board by a single governor and trustee, but also makes it clear that the remit of Sir Sydney Caine in his new function is that of a night watchman.

Mr. Hugh Fraser

A what?

Mr. Bell

A night watchman.

Mr. Hastings

Without a fire.

Mr. Bell

Without a fire. Of course, he is not expected any longer to run the bank. After all, six distinguished gentlemen have been not running the bank in one of the famous non-events of the party opposite for the last year. Now, that position is being recognised. To that extent at least, I welcome the Order.

The Minister of State and his hon. Friend the Member for Manchester, Blackley (Mr. Rose) spoke about an illegal régime and tightening the screws. In passing, how does this amending Order tighten any screws? It might be described by some a a notable loosening of screws. At least, the hon. Gentleman thought fit to talk about tightening the screw because of the illegality of the régime. I put this question to the Minister of State: if this is a tightening of the screw because the régime is illegal, are we have a similar Order every time there is an illegal régime? Is one coming forward for the illegal régime in Sierra Leone, which is a rebellion against the Crown? [HON. MEMBERS: "Oh."] Of course, it is. Are we to have an Order taking over their assets and sweeping away the board of the Bank of Sierra Leone, appointing a governor and trustee? It is an illegal régime, a rebellion against the British Crown.

Mr. Deputy Speaker

Order. We cannot go into the affairs of Sierra Leone on this Order.

Mr. Bell

With respect, Mr. Deputy Speaker, that is precisely my point. We ought not to go into their affairs, just as we ought not to go into the affairs of the parallel case.

Mr. George Thomas

If I have your permission, Mr. Deputy Speaker, I shall inform the hon. and learned Gentleman that Sierra Leone is an independent country. Rhodesia is a Colony.

Mr. Bell

I am not sure how far I can go in stripping the veneer off that shallow intervention. It is a question of the Crown and rebellion against the Crown. When the Lieutenant-Governor is locked up—

Mr. Deputy Speaker

Order. This is quite irrelevant. The only question under this Order is whether we should substitute a governor and trustee for a governor and board of directors.

Mr. Bell

I appreciate that, Mr. Deputy Speaker, but you will understand that I was to some extent led away by the Minister of State. If he claims that he was to some extent led away by me, I point out in reply that this amending Order defines the functions of the governor and trustee whom it institutes, referring to one of his functions as being to protect the assets of the Bank of Rhodesia against people purporting to have control over it. In a sense, therefore, as this Order, for the first time, defines those functions in express terms, it raises for our debate tonight the substantive point as to whether we are right to usurp those functions.

Strictly speaking, therefore, though I have no wish to enlarge the debate in that way, I am in order in what I was saying and in making the comparison with other régimes elsewhere in the world. However, I shall not go into that, save to make the broad and sweeping point that half the members of the United Nations are illegal régimes. The Minister of State, therefore, ought not to lean too heavily for his amending Order tonight on that very founderous argument.

That is all I wish to say. In a way, I welcome the Order. Inasmuch as it cuts this farcical board down from six to one, it is a further step in the achievement of national unity against the Prime Minister, which I very much look forward to, in this whole Rhodesia business.

11.15 p.m.

Sir Knox Cunningham (Antrim, South)

We have heard a great number of points in the debate tonight, and I shall not repeat them. [HON. MEMBERS: "Hear, hear".] If hon. Members opposite wish to hear me speak at length, I shall be delighted to do so.

The Minister of State opened the debate by saying that the governor, deputy governor and the other directors appointed under the Reserve Bank of Rhodesia Order, 1965, were there to preserve the external assets of the bank. What have they done? Have they preserved the assets? Have they carried on any banking? What have they done? Under the Order we shall do away with them and substitute a governor and trustee. Why? Is it because the directors have said that they are resigning?

Under the Order, the Secretary of State will appoint a governor and trustee who will exercise his functions "either in Southern Rhodesia or elsewhere." What functions can he and will he exercise in Southern Rhodesia? Surely his only functions can be exercised elsewhere, and what will they be?

Mr. John Lee (Reading)


Sir Knox Cunningham

I am sorry; I shall not give way at the moment.

Under paragraph (i) of the new Article 3 of the principal Order, the Secretary of State may from time to time give the Governor and Trustee such general or special directions relating to the policy of the Bank or relating to the exercise of the powers and duties of the Governor and Trustee as he may think fit, and the Governor and Trustee shall comply with any such directions. That means that the governor and trustee is the creature of the Minister. He will be given his directions, his riding orders, and he will carry them out. What is the point of that? It is a farce. Why should the Minister not act? Why appoint this stooge to act as the Minister's creature? I hope that we shall have a reply to those questions.

11.22 p.m.

Mr. Patrick Wall (Haltemprice)

The board of the bank we are discussing was set up in 1965 with a great fanfare of trumpets. All these important people in the City were to form part of the economic machine which was to crush the frightened little men in Salisbury a few months before they were deprived of oil—the futility of which we are to discuss in the second Order.

It is therefore relevant to see what the bank has done since it had that task imposed on it by the Government. Its first action, as the hon. and learned Member for Northampton (Mr. Paget) pointed out, was to seize the Rhodesian sterling reserves in this country. As the hon. and learned Gentleman said, they were estimated at between £8 million and £11 million. A direct result of this action was that the Rhodesian Government defaulted on all the loans and the servicing of debts on money raised on the London market, which was estimated at £160 million.

The consequences of that act have been referred to in an article in the Financial Times of 20th March this year, which I commend to the attention of the Minister of State. I shall not read it to the House, but I hope that the hon. Gentleman has read it, because it is very salutary. It says that in 1965 the Rhodesian visible trading surplus was about £42 million and there was a deficit on "invisibles" of £28 million.

What happened as a result of the first action taken by the bank was that the income normally paid to individual citizens in this country from Rhodesia, totalling about £10 million, was not paid, and a debt payment of £9 million normally paid by Rhodesia to this country was also not paid. Therefore, the net result of the bank's action was to present Rhodesia with £19 million. One of our most responsible financial newspapers produced those figures, which I have quoted.

Mr. Robert Maclennan (Caithness and Sutherland)

Does the hon. Gentleman seriously suggest that if that action had not been taken the Rhodesian Government would not have defaulted on their international liabilities? Will he bear in mind their action in relation to their liabilities under the International Bank agreement?

Mr. Wall

As far as I know, the Rhodesian Government have not defaulted on any loans which were not said to be the responsibility of the British Government. In other words, they maintained that as the British Government have deprived Rhodesia of the reserves held in her name in this country, understandably, she refused to service any international loans normally serviced through these sterling balances. This seems to be a normal and sensible action deriving from the course of events.

But there is more to it than that, because surely the seizure of reserves from a country with whom we are at the moment in dispute is going to make it more problematical whether other countries will continue to retain large sterling balances in this country I know it is never stated what sterling balances are maintained in this country by other countries, but I am prepared to take a wager with the Minister that the sums have been considerably reduced since the action of the alleged Rhodesian Reserve Bank.

But perhaps of more direct interest is the effect on British citizens. I commend to the House a paragraph in the editorial of the Daily Telegraph, of 20th March, in which it said: It was supposed that where Britain could assume a responsibility she would discharge it normally. When she took over the Rhodesian Reserve Bank it was surely reasonable to suppose that its sterling assets would be used to honour its obligations. But Mr. Callaghan has stated that he 'cannot accept any responsibility for the liabilities of the Rhodesian Government'. Incidentally, the right hon. Gentleman repeated that statement in a Written Answer to me last week. The article went on to say: It is, in fact, a British chairman who is presiding over the default on dividends with the approval of the Chancellor", and that is having serious repercussions for many British citizens who are now deprived of their income because of the direct action of this bank whose future we are now discussing.

I propose to make only one other reference to a quotation, and this sums up the position very well. This is from a gentleman called Mr. Beney, a Q.C., who wrote to the Daily Telegraph on 16th March, and in his final paragraph he said: It is a double injustice when the Government of the country first encourages its citizens to invest their money in the other country's loans; then tries to destroy that country's economy in such a way that the security for those loans disappears. And then expresses its sympathy with the victims. I think that that describes what has happened to British bond holders of Rhodesian stock due to the bank's action.

There is a third effect of the action taken by the Rhodesian Reserve Bank. I am referring now to the bank notes which were to be printed in Germany. I understand that they are being printed elsewhere, so they will not be denied to the Rhodesian Government. What happened was that the British Government went to law in Germany and lost the case in two separate courts and finally had to make a settlement out of court. I would like to know how much that settlement cost. The Press reported that it cost £180,000. I asked the Chancellor the other day, and received the reply that it was a comparatively small amount, or words to that effect. I hope that when the Minister replies to this debate he will tell us how much this out-of-court settlement cost the British taxpayer.

What work will this board now do? We had a most impressive board to begin with. We are now to have a board consisting of one man. What work is the board supposed to do during the forthcoming year? This Order puts the board of the Rhodesian Reserve Bank in suspended animation. This organisation has done nothing but disservice to Britain's good name during the time it has been in existence, and I am glad to see it buried.

11.29 p.m.

Mr. Victor Goodhew (St. Albans)

I would like to ask the Minister of State how much longer we on this side of the House are to have to sit and listen to the hypocrisy and humbug which Members of the Government keep spouting at us. It really is remarkable. We had the Prime Minister today telling us that we on this side of the House were guilty of subverting law and order in Rhodesia, but it is right hon. and hon. Gentlemen opposite who are trying to overthrow the legally elected Government of that country.

Mr. Elystan Morgan (Cardigan)

On a point of order. I think I am correct in contending that paragraph 167(x) of the Manual of Procedure rules against the use of seditious or treasonable terms by any Member of the House. Quite obviously, since the illegal régime in Salisbury is in a state of active rebellion against the Crown, any statement by a Member of the House that that régime constitutes a legally elected Government must amount to the condition which is prohibited by that paragraph.

Mr. Deputy Speaker

I listened carefully to what the hon. Member for St. Albans (Mr. Goodhew) said, and I am aware of the paragraph to which the hon. Member for Cardigan (Mr. Elystan Morgan) has referred. I am sure that the hon. Member for St. Albans will confine his remarks within the rules laid down in the Manual of Procedure.

Mr. Goodhew

I remind the Member for Cardigan (Mr. Elystan Morgan), who was so rapid in getting to his feet, that I merely quoted the Prime Minister, who earlier today accused hon. Members on this side of the House of seeking to subvert law and order in Rhodesia. I was saying, and I say it again, that it is the Government who are trying to bring about the downfall of a government which has been legally elected in Rhodesia. That was the phrase I used. If the hon. Member looks in HANSARD tomorrow he will find that he was a little too rapid in getting to his feet.

The Minister of State is greatly respected for his sincerity, and it grieves me to hear him using the phrases he has used this evening about the funds being used to restore the economy of Rhodesia when it returned to legality. These funds belong to all the people of Rhodesia and it is not for the Government to say that they will hold on to them for the time being.

When the Minister of State talks about restoring the economy eventually does he realise that it is hon. Members opposite who are doing their best to destroy it? It is sheer hypocrisy to come to this House this evening and talk so glibly about trying to preserve these funds and about the restoration of the economy when they have done their best to destroy it.

It is not only the Government who are trying to destroy it. Having failed to do so on their own they are trying to bring all the countries of the world into joining them. Well, they have failed so far.

Mr. Deputy Speaker

Order. We cannot go into all that. In this Order we are concerned only with whether there should be a governor and board of directors or a single governor and trustee in this bank.

Mr. Goodhew

I was mentioning this in passing in explanation of what I regard as the hypocrisy of hon. Members opposite.

It seems to me quite remarkable that we should have this Order before us this evening and that we are being asked to replace a board so obviously impotent with ordinary banking interests in Rhodesia with a governor and trustee who is equally impotent.

We have here all the panoply and pomp of State

"The Reserve Bank of Rhodesia Order 1967
Made 23rd March 1967
Laid before Parliament 31st March 1967
Coming into Operation 1st April 1967
At the Court at Windsor Castle, the
23rd day of March 1967
The Queen's Most Excellent Majesty in Council"—
all the pomp and panoply of State for complete and utter nonsense which makes us the laughing stock of the world. I hope that the Government will come to their senses before long and realise that this sort of policy can only damage the economy of this country and do harm to what they themselves want to achieve, which is a constitution which provides for an increase in African representation. I hope that the Government will change their mind about this Order before long.

11.34 p.m.

Mr. John Lee (Reading)

I wish to intervene for only a few moments because I do not see why the reputation of this House should be damaged through it being turned into a racialist benefit match. For that reason it is right that a Member from this side should intervene to say that hon. Members on this side, with one conspicuous exception, support this Order. The day will come when the bank which has been established in this way will be able to carry out its functions in Rhodesia. The one thing which is clear about all this is that it makes it all the more important that the day will come when we are prepared to use force to enable it to carry out its functions in Rhodesia.

The objections to the Order seem to fall into two categories. Either it is said that the Order is futile because it is unenforceable, or that it is harsh because it is enforceable. I do not see how hon. Members opposite can maintain both arguments at the same time. It will be a great pity if the short-term effects of the Order, which give the illegal régime a benefit by sloughing off its liabilities and should obscure its long-term usefulness, but I hope that my hon. and learned Friend the Solicitor-General will give us some indication of how the Order is to become effective.

Much ridicule has been poured on the members of the board of directors. I think that the Prime Minister showed remarkable skill in assembling a board which included one ex-Chairman of the Conservative Party, whose views on legality attract a great deal more respect than do those of many Conservative hon. Members who are here tonight. Whether it is a board of several members or of one man, it is important that the Order should be effective, and I therefore want my hon. and learned Friend to tell us whether he is prepared to use sterner measures to deal with the robbers who took over these assets in Rhodesia and to see that these assets, which should be under the control of the bank, can be used in the discharge of its proper function.

Sir Knox Cunningham

When the hon. Gentleman said that with one notable exception his hon. Friends were behind him, did he also mean behind him in the use of force?

11.37 p.m.

The Solicitor-General (Sir Dingle Foot)

The issue which the House is now called upon to decide lies within a very narrow compass. We are not asked to approve the policy of sanctions against the illegal racialist régime in Salisbury. That policy has already been approved by the great majority of the House. I know, of course, that hon. Gentlemen opposite have always been deeply divided on these Rhodesian issues, but that does not apply to my hon. Friends. What we are concerned with in this Order is whether we shall substitute one form of control of the Reserve Bank for another, whether we are to substitute a governor and trustee for a governor and a board of directors.

The right hon. Member for Bridlington (Mr. Wood) asked why it was necessary to make this change. It was not necessary to make the change, but in the circumstances it was desirable to do so. When it was set up under the original Order in 1965, the purpose of the board was to get in the assets of the Reserve Bank in different parts of the world. I was asked how successful that operation has been. I do not think that I can be expected to give figures, because, after all, we are here dealing with the affairs of a bank. I can answer only in general terms and say that we are satisfied that that has been a successful operation.

Why was it necessary to make the change? The assets having been got in, that is to say, the main purpose of the exercise having been fulfilled, it was no longer necessary to maintain a full board of directors.

Mr. Hugh Fraser

I cannot follow why the figures should not be published. In the hon. and learned Gentleman's view, this must be enemy property and the figures should therefore be published. I do not see why they should not be and we ought to know what they are.

The Solicitor-General

This is not enemy property, it is the property of the people, all the people of Rhodesia. I will come a little later to the point raised by the right hon. Gentleman. For the time being the activities of this board must be very much circumscribed, the assets having been got in. Therefore, it was thought unnecessary that we should maintain a full board in existence. That is the reason why this change is being made.

The right hon. Gentleman went on to ask me when we were likely to give an alternative to the governor and trustee. All that I can say is that various names are under consideration, and the actual name will be announced very soon. [An HON. MEMBER: "Kaldor.] He also asked me certain question about the proceedings in Germany and the cost of them to public funds.

I repeat the answer given, that the cost to the British taxpayer is negligible. It is perfectly true that there was a settlement, and I am not withholding anything from the House. There was a settlement, but that was arrived at by the bank, and it does not involve any charge to public funds in this country. I will give the right hon. Gentleman the figure. The figure involved was D.M. 3 million, amounting in our money to £275,000. That was the amount paid for the settlement, but, as I say, it does not fall on the taxpayer in this country.

I will come in a moment to the question about to whom the money in the bank belongs. The right hon. Gentleman went on to raise the question asked by my right hon. and learned Friend the Member for Northampton (Mr. Paget) and other hon. Members. He complained that the responsibility had not been assumed for the interest on Rhodesian stocks. He suggested, I think, that we should in some way, assume it.

My answer to that is that this is not the responsibility of the British Government. We are not responsible for the default. The default follows directly from the rebellion in Rhodesia, and although the regime tried to make our Reserve Bank Order the pretext for its default, there is no connection between the two events. I repeat that the responsibility for the payment of interest on Southern Rhodesian stocks is not that of the Reserve Bank, nor is it that of Her Majesty's Government. It is the responsibility of the Government of Southern Rhodesia. [An HON. MEMBER: "There is not one."]

I agree that at this moment there is not one, but I am saying that responsibility does not rest with us. I am not trying in any way to evade the issue. I agree that we could meet this situation. We could pass a special Order in Council which would authorise the Secretary of State, in this regard, to assume the powers of the Government of Southern Rhodesia, to procure the payment of interest.

He could then, if he thought fit, instruct the bank to make the interest payments. I am not suggesting for a moment that such an Order could not be made under the Act. I submit to the House that there are valid reasons for not making it.

Mr. Paget

Are we or are we not the Government of Southern Rhodesia? This is very important. If we are not the Government of Southern Rhodesia, who is?

The Solicitor-General

I am saying that we have not assumed all the functions of the government of Rhodesia. The government of Rhodesia is still vested in the Crown represented by the Governor. There is a government machine which cannot legally operate in the present circumstances. We are not the Government of Rhodesia. It would be wrong that we should assume the obligations of the Government of Rhodesia. I return to the point that I was making in answer to the right hon. Gentleman and other hon. Members. The position is that there are various creditors of the Rhodesian Government. These are not the only creditors. If we were to authorise payment out of the interest on these stocks we would be discriminating in favour of one type of creditor against other creditors.

But there is a still more compelling reason than that. We announced in 1965 our intention to set up a London board of the Reserve Bank … to preserve the assets of the Reserve Bank for the people of Rhodesia as a whole. This is really the point that was made by my hon. Friend the Member for Manchester, Blackley (Mr. Rose). We have to preserve those assets until the time when legal constitutional government is restored. That is why we cannot take the measures which I admit would be within our powers to ensure the immediate payment of interest on Rhodesian stock—

Mr. Ronald Bell

If this is the object, can the Solicitor-General explain how the-payment of £275,000 of Reserve Bank money to a German firm is a way of preserving assets for the people of Rhodesia, since the consideration for that payment was only that the firm should not print bank notes, and no benefit was derived from that by the people of Rhodesia?

The Solicitor-General

It was obviously desirable that the illegal régime should not be able to place this kind of order in foreign countries, and it was in the interests of the people of Rhodesia that these proceedings should be brought in Germany, and that they should have been compromised in the way they were.

I come now, if I may—

Mr. Wall

Can the Solicitor-General give an assurance to the British bond holders that once this business has been settled one way or the other they will have their back payments paid by the Reserve Bank? That is what is causing the anxiety.

The Solicitor-General

I appreciate the anxiety, but I think that the hon. Gentleman would not expect me to give an answer to that question here and now, because it must be a matter for the bank. Obviously, I cannot assume responsibility here for all the affairs of the bank when legal constitutional government is restored, but I certainly expect that the claims of British bond holders will be met, just as the claims of other bond holders will be met when that stage is reached.

The hon. Member for Chigwell (Mr. Biggs-Davison) asked whether the German case was the reason for this change. All I can say to him is that I do not think that he could have listened to my hon. Friend the Minister of State, who made it perfectly clear that we had resolved upon this change before the German proceedings were initiated but that it was thought desirable to postpone the announcement until after their conclusion.

I pass over some of the observations that have been made because, as I said before, we are not concerned with the general policy of sanctions upon which so many hon. Members opposite wished to embark, but the hon. Member for, I think, Buckingham, used the phrase that we were laying our hands on other people's money. That is precisely what we are not doing. What we are doing is to preserve other people's money. We are preserving the money which be- longs, as I said before, to all the people of Rhodesia. That was the purpose of this exercise in setting up the board in 1965 and of the changes we are making now. It is for that reason—

Mr. Ronald Bell

The hon. Member for Buckingham (Mr. Maxwell) has not addressed the House this evening, and I should not like to be confused with him. And I did not say that. So there is a double error here.

The Solicitor-General

I am sorry if I got the hon. and learned Member's constituency wrong, and I am sure he will accept my apology on that score. Secondly, I took down his words in inverted commas, and he did speak of our laying hands on other people's money.

I think that those are the substantive points that have been raised. We had the general pro-racial speeches we are accustomed to hear from certain hon. Members opposite, who can never make up their minds how far they will go in order to support the rebellion in Rhodesia. Those speeches are in no way germane to the issue we now have to decide, and I therefore suggest that the House should accept the Order.

Sir Knox Cunningham

If Her Majesty's Government are not the Government of Rhodesia, how is it that the hon. and learned Gentleman comes to the House tonight, as a member of that Government, and presents an Order which is going to be exercisable either in Southern Rhodesia or elsewhere? Can he explain the position of the Government and why they are not the Government of Southern Rhodesia?

The Solicitor-General

I thought I had made it clear that the government of Rhodesia is vested in the Crown as represented by the Governor. We have taken powers to make certain laws in respect of Rhodesia. We have never taken over in this country the government of Rhodesia. I hope that that distinction is now clear to the hon. and learned Member.

Question put and agreed to.

Resolved, That the Reserve Bank of Rhodesia Order 1967, dated 23rd March, 1967, made by Her Majesty in Council under the Southern Rhodesia Act 1965, a copy of which was laid before this House on 31st March, be approved.

11.50 p.m.

Mr. George Thomas

I beg to move, That the Southern Rhodesia (Prohibited Trade and Dealings) (Amendment) Order 1967, dated lath March 1967, made by Her Majesty in Council under the Southern Rhodesia Act 1965, a copy of which was laid before this House on 15th March, be approved. In view of the fact that the House is obviously of one mind so far as the Lobby is concerned on these Orders, I trust that I may deal with this one at not too great a length.

By an error, Mr. Deputy Speaker, when you were not in the Chair, I began to move this Motion a little earlier this evening.

This is an essential step which Her Majesty's Government consider necessary to tighten up the enforcement machinery in existing sanctions. It is a reminder, I repeat, to all the people of Rhodesia, both black and white, that we intend to fulfil our obligations to the United Nations under the Security Council Resolution to the utmost. We intend to keep faith with those who have no liberty themselves in Rhodesia. I see that the hon. Member for Haltemprice (Mr. Wall) keeps laughing. If he would spare a thought for some of those dark-skinned people and the life they have to endure he would realise why this Motion is so necessary.

The main part of this Order is in Article 3 and it amends the Order of 1966 by inserting in it a new Article to be numbered Article 8A. This confers powers on the Secretary of State in relation to the transfer of the ownership of certain property overseas where it appears to him that such transfer might facilitate the contravention or evasion of the Order of 1966 or of the Petroleum Order of 1965.

The property in question is property in which persons who are subject to the Article have such an interest as would give them a say in whether the ownership of the property should be transferred. In most cases they would be in this position because they themselves owned the property, but the Article also covers cases where their ability to influence the disposal of the property arises in other ways—for example, because they are shareholders or because the property cannot be transferred without their concurrence and so forth.

Article 3 does not purport to operate directly on the property in question since this might be open to objection as involving an exercise of extra-territorial jurisdiction. Instead, it operates on persons who have a specified interest in the property and who are themselves unquestionably subject to our jurisdiction. The Order is necessary because we were much exercised by a particular case, although we have several other possible cases in mind. The particular case relates to the oil pipeline from Beira to Mozambique to the oil refinery at Feruka in Rhodesia.

The background to the ownership of the pipeline and the right to operate it is complicated, but, broadly, the ownership is vested in the Mozambique company usually referred to as C.P.M.R. Approximately 40 per cent. of the shares are owned by Portuguese nationals and about 60 per cent. by a United Kingdom company, Lonrho Ltd. The latter has a number of directors on the board of C.P.M.R., the Portuguese company, but, because of the requirements of the local law, the Portuguese directors are in the majority.

Two relevant concessions relate to the pipeline. That relating to Portuguese territory was granted by the Mozambique Government to C.P.M.R. and that relating to Rhodesian territory was granted by the Rhodesian Government to Lonrho. Each concession provides that it cannot be assigned or disposed of without the consent of the Government concerned. Despite this obscure and complicated setup, the fact that Lonrho has a 60 per cent. majority shareholding in C.P.M.R. and also holds the Rhodesian concession has played a valuable part in the past in preventing oil being pumped up the pipeline to Rhodesia in contravention of our sanctions.

However, because of the Portuguese majority on the board of C.P.M.R., it has not been a complete safeguard. With the passage of the Security Council Resolution in April last year, the question has, in a sense, become less important, since the steps which we and others have taken to prevent the shipment of oil to Beira for transmission to Rhodesia have so far been completely effective. However, we cannot afford to relax our defences in this case and we would not like United Kingdom nationals or companies to be seen to be co-operating in any step which might lead to our defences being breached or evaded.

The House will understand the seriousness with which the Government have had to view this situation, since Lonrho Ltd. recently approached the Government with the information that certain foreign companies were interested in buying both C.P.M.R. and Lonrho out of the pipeline by buying the undertaking and the related concessions. The Lonrho directors properly accepted that a good title to the concession in Rhodesia could not be transferred without the consent of the lawful Rhodesian Government, for which we alone could speak in present circumstances.

It is fair to say that Lonrho Ltd. was not surprised when we told it that, as things now stand, we would find it impossible to give the consent which it sought for the sale of the pipeline. Nevertheless, the company told us that its duty towards its Portuguese partners in C.P.M.R. might make it difficult for it to co-operate in any projected sale of the undertaking. It also pointed out that it could not guarantee that its failure to provide a good title to the concession would necessarily be an effective obstacle.

We also gathered that there were interests—South African, Portuguese and, possibly, Rhodesian—concerned in the likely purchase of this pipeline. It is only fair to point out that the directors of Lonrho Ltd. have since made it clear that they would not themselves willingly and freely co-operate in any transaction which ran counter to our policy in this matter. But circumstances might obviously have arisen in which, in the absence of any legal impediment, they would have had no real option in the matter. The important thing for this House was that a United Kingdom company should not participate, willingly or unwillingly, in the sale of a pipeline that might be used to break the sanctions on which we are embarked.

Broadly speaking, the effect of these directions is to prevent Lonrho from transferring to any other person its interest in the pipeline or any related concession, to prevent it from permitting C.P.M.R. from transferring its interest in the pipeline and the concessions, and to prevent it from relinquishing to any other person its present shares in C.P.M.R. and such powers as it at present has to control the affairs of C.P.M.R.

As I have explained, the Lonrho case was not the only one that we had in mind, although it would not be right for me to go into the details of other cases which have occurred to us. But to give a hypothetical example, I might instance the sale of other kinds of transport facilities and undertakings which could be used either for the importation into Rhodesia of prohibited goods or for their exportation from Rhodesia.

When I think of the dark-skinned people in Rhodesia—

Mr. Wall

Who is being racialistic now?

Mr. Thomas

The hon. Gentleman does annoy me sometimes. I was saying that when I realise that I am the spokesman, as is this House, for the dark-skinned people who are denied elementary human rights and who are subjected to police state conditions, to pass this Order is the very least the House can do.

12.4 a.m.

Mr. Wood

We are discussing an Order which is both grave and—although the Minister will not agree with this—a great deal less significant than even the last Order we were discussing.

The aim of this Instrument is to prevent the sale of property outside the United Kingdom which could be used to contravene the terms of the main Order of 1966, against which my right hon. and hon. Friends made clear our reasons for voting on 6th February last. As I understand the position, the Secretary of State can give to any person to whom the Instrument applies directions in writing to refrain from selling property that might facilitate a contravention of the 1966 Order.

One of the main difficulties of the Order seems to be that there is nothing in it to prevent the sale of property if the Secretary of State has not previously in writing forbidden it. Therefore, it is obvious that the effectiveness of the Order must depend on the amount of prior information which the Secretary of State is able to obtain about any likely sale in the future. Once a sale has gone through, there is nothing that he can do about it. That is my understanding of the Order, and I do not think that I have misinterpreted the hon. Gentleman's speech.

In order to make the Order effective, will the Secretary of State not have to set up some system of industrial espionage, so that he may hear of any intended decisions before they are taken? Is that really what the right hon. Gentleman intends to do? If not, I wonder seriously it the Order is worth making.

It may be that, occasionally, the Secretary of State happens to hear by chance of some impending sale before it takes place, but it is more likely that the right hon. Gentleman would not have that information unless he took complicated and widespread steps to try to get it. If that is not what he intends to do, is the Order worth making? If he intends to set up this system of espionage, is it not wholly undesirable?

Any firm is permitted to do its best, in normal circumstances, to preserve the maximum degree of secrecy about its future intentions. That would not be offensive to anyone. Therefore, this Order leads to a direct and legal conflict of interest between business concerns and the Government. A business concern may be perfectly unaware that the action which it contemplates is of any concern or in any way offensive to the Government. If a sale goes through before the Government hear of it, all is well with the transaction. If the Government hear of the intentions of the firm, all may be off. It is an incentive to the firm to keep its intentions even more secret than it would otherwise.

I do not believe that the right hon. Gentleman intends or would be able to weave this complicated web of espionage, without which this Order will add almost nothing to the main instrument of mandatory sanctions against which we voted on 6th February. One of the most important grounds on which we have, on two occasions, opposed the United Nations mandatory sanctions is that, in our conviction, their result inevitably will be the precise opposite to that intended by the Government. We believe that they make more difficult and more unlikely a settlement of the dispute between Britain and the Rhodesian régime, and, on two occasions, in December and February, we voted against what we considered to be the mistake which the Government were making.

We do not believe that, by voting against this insignificant and ineffective extension of Government policy, we can make any clearer our opposition to the course which the Government chose to take four months ago. However, I wait with interest to hear an explanation of the steps which the Secretary of State intends to take, if he does intend to take them, to make this latest extension add anything to the policy of mandatory sanctions, which we shall continue to oppose.

12.9 a.m.

Mr. Frank Hooley (Sheffield, Heeley)

My right hon. Friend the Secretary of State can rest assured that he will have the full support of all members of his party for this Order.

This Parliament is the lawfully constituted authority in Rhodesia. It is the only authority with full constiutional rights to deal with the affairs of that country. Even if this were not so, even if we had no direct constitutional authority, if the British Government had no direct concern with the affairs of Rhodesia, the Government and the country would be bound, as a signatory State to the Charter of the United Nations, to put into effect an Order such as this. The Security Council of the United Nations, in complete and proper exercise of its authority under Chapter 7 of the Charter, has imposed selective mandatory sanctions against the illegal régime. The Order, perhaps in a small and not very significant way, but certainly in conformity with the decision of the Security Council, draws firmer our grip and tightens the sanctions which we are operating to bring down the illegal régime.

I remind the House that, in doing this, we are acting in concert with at least 90 other nations and with every major industrial power. Some hon. Members opposite are whistling to keep up their courage. They know that the Rhodesian tobacco crop is unsold. They know that the sanctions are becoming more effective. They know that the white population is becoming more and more divided and uncertain and that other groupings are developing. I cannot pursue that theme without becoming out of order, but it is not unrelated to this Measure which is before us and which will be approved by the House.

It is unfortunately true that in the history of mankind treason and rebellion by lawless rogues and thieves have done grave damage to honest men. This, alas, we cannot from time to time avoid. We know also that such lawless rogues and thieves do from time to time find apologists and accomplices in high places. We know that they may for a time laugh at authority and make unlawful profit. We know that eventually rebellion and treason will be put down and constitutional law restored.

12.13 a.m.

Mr. Ronald Bell

Once again I fear that the Minister of State stated by leaning on a morass of weakness when he seemed to think that the best point he had to make in support of the Order was that it was being promulgated in execution of the Security Council Resolution. Since that Resolution, as I thought we had all agreed, was wholly illegal and invalid—even the Attorney-General was able to put up only a somewhat halfhearted defence of it—surely the worst thing that can be said is that this, which is being done in the interests of legality, as it is said, is done in pursuance of the greatest illegality that has struck the world in this century, namely, the breach by the Security Council of the United Nations of the plain meaning of its own Charter.

The powers conferred by the Order go far too wide. This is not delegated legislation, because it is not legislation in any true sense of the word. The Government have gone so far in their anti-Rhodesian frenzy that they have finally abandoned any attempt at defining prohibited actions and given an unfettered power to a Minister of the Crown. I invite hon. Members, some of whom have appeared to cheer the Order, to look at it. The relevant paragraph is contained not, as the Minister of State erroneously said, in Article 3, but in Article 2. The hon. Gentleman is having a difficult time tonight. Article 2 empowers the Secretary of State to give directions. If it appears to the Secretary of State that the transfer of the ownership of any property to which this Article applies may facilitate the contravention or evasion of this Order… That is the first leg of it. Thus, If it appears to the Secretary of State"— it does not have to be anything more than that— that the transfer of the ownership of any property to which this Article applies"— not necessarily the transfer of any property to Rhodesia or anything like that, but any transfer of, in effect, any property owned by a British subject— may facilitate"— not "constitute"—a contravention or evasion"— not just a contravention, but an evasion. In that context, what can "evasion" mean but something which is not a contravention, something which is wholly legal, not forbidden?

Therefore, any transfer by a British subject of any property which may facilitate, not even a contravention, but an evasion, may be the subject matter of directions in writing requiring the person to whom the direction is sent to take or … to refrain from taking such action in relation to that property as the directions may specify". There again, there is absolutely no limit or boundary. Any direction which the Secretary of State sees fit to give may be given, and any person to whom directions are given under this Article shall comply with them. Any directions … may be either general or special … and may be revoked or varied by subsequent such directions. I have seen a good many Statutory Instruments in my time. I have given some of my time in the House of Commons to the scrutiny of them in the Select Committee. This Instrument offends against every canon of law-making in this country. It is vague, it is discretionary, it is wide-ranging.

Article 3 presumes guilt. It states: In any proceedings against any person for a contravention … of this Order, if it is proved that, notwithstanding any directions given to him under that Article in relation to any property, the ownership of that property or of any interest in or right over that property has been transferred"— not by him necessarily— the burden of proving that he complied with those directions shall lie upon him. Therefore, I say, it presumes guilt. It is oppressive in its operation and spiteful in its motivation. It exhausts, except only in savagery of punishment, the whole armoury of tyranny.

How blunted our susceptibilities have become about rules and orders is shown by the way in which this Order is being passed tonight. There are few present in the Chamber. There is to be no Division. We are getting so used to Instruments which allow the Executive to do anything that even so extreme an example as this Order raises no ripple of interest.

However, there is one point of significance in the Order which may receive a tiny fraction of the notice which it deserves. This is the latest in a series of cannibalistic, self-destroying Orders in which the British people are tearing at their own vitals. For those whom it is meant to hurt are as much a part of the British people as we who will tonight, after this debate, walk home through the streets of London. It must be some tragic cancerous death-wish which mesmerises us as we aim the random malevolence of this Order at the loyal and sturdy British people in Rhodesia, for no better cause than the exultant smirks on the faces of the sort of people who hang about the corridors of international organisations.

I gather that there will be no Division, but I wanted to take this opportunity to dissociate myself in the most explicit and formal manner possible from the shameful action which Her Majesty's Government are taking. I hope that even the Minister of State, who sometimes disagrees with what I say, just as I sometimes disagree with what he says, will feel impelled to begin to diverge from the ruinous folly of the Prime Minister in this whole Rhodesia business. I hope that he will regard this Order, in the extremity of its vagueness, its viciousness, its spiteful attack upon our own people, our families and friends in Rhodesia, as marking a point beyond which he will not go with his right hon. Friend in oppression, injustice and tyranny.

12.22 a.m.

Mr. Paget

The hon. and learned Gentleman the Member for Buckinghamshire, South (Mr. Ronald Bell) makes rather heavy weather of an Order which seems to me to do practically nothing.

Mr. William Molloy (Ealing, North)

What we have just listened to was just a "phoney" act for publicity purposes. There was nothing sincere in it at all.

Mr. Paget

I think that that might apply to quite a lot that we hear on this issue, and I do not wish to go into that too much.

Mr. Ronald Bell


Mr. Paget

No—I am sorry. The hon. and learned Gentleman put what I regard as a rather exaggerated view of the Order. As I understand it, the purpose of the Order is to try to prevent the sale of a pipeline partly in Mozambique and partly in Rhodesia. So far as it is in Mozambique, it is in the control of a company the majority of whose board are Portuguese. The majority of that board, whether the Government give a direction to the minority or not, can still sell an asset of the company, that is to say, the pipeline. No direction given here can affect the decision taken in Mozambique.

So far as the pipeline is in Rhodesia, although we may for some purposes claim to be the Government of Rhodesia and for other purposes say that we are not, as a matter of practice our writ does not run there. If the illegal but none the less effective Government of Rhodesia wish the ownership of the Rhodesian part of the pipeline to be transferred to themselves or to anyone else, that is the effective decision. Therefore, the Order will be entirely ineffective in the particular case to which it is directed.

I now turn to the wider questions. The right hon. Member for Bridlington (Mr. Wood) pointed out that it applies only where the Government have had notice of what is intended and made a prohibition order before the sale in question is carried out. I think that industrial espionage is also very heavy weather here. The only transactions which the Government will hear about are those about which the directors tell them because they want an excuse for not doing what they do not want to do anyway. If they want to do it, they will not go to the Government; if they do not want to do it, they will provide themselves with an excuse to their shareholders. That is all that it adds up to, and such a case must be pretty rare.

12.27 a.m.

Mr. Wall

When the history of the House comes to be written these two Orders will seem to have been some of the most extraordinary ever debated. The only parallel is, I think, in "Alice in Wonderland".

The Minister of State has told us that the basis of the Order is to stop the sale of the Lonrho pipeline. The aim of the Order is therefore to make effective the wishes of the minority of directors in non-British company operating in a territory not under British control.

I have two questions for the Minister. First, has the direction on this pipeline been written by the Secretary of State?

Mr. George Thomas

Yes. The order was given on 15th March. It was brought before the House at the first possible date, and the Standing Orders were complied with.

Mr. Wall

I am sure that the Standing Orders were complied with, but the effect is that it is, in essence, retrospective legislation.

The important question is how we intend to enforce the Order. The Minister has already admitted that the British directors are in a minority. They are not in control of the company and therefore the majority—not of shareholders, but of directors—can decide to sell the pipeline if they want to. It lies in Mozambique and Rhodesia, and there is nothing the British Government can do to stop the sale. I recognise that the Order places on the British directors responsibility to do their best to stop the sale, but the Minister must recognise that they cannot stop this sale if the majority of the directors wish to go ahead.

I believe that the British Government have been paying Lonrho compensation because the pipeline has been out of action due to the blockade of Beira by the British Navy, and that it amounted to about £250,000. Is it still being paid?

Mr. George Thomas

The hon. Gentleman is not quite correct. We have not paid any compensation. We have given help for the maintenance and repair of the pipeline and we consider that enough has been given for that.

Mr. Wall

I take it that the pipeline is now fully maintained and repaired, at a time when it may well be disposed of to people who are officially our enemies. We are taking action in this Order to stop the sale of the pipeline and have been blockading the port of Beira for a year to stop oil passing through the pipe. I think that the Minister will know that the Portuguese Government have put in a claim to the United Nations for £10 million damages.

Why are we the only country to take action? Why is it only the British Navy which is maintaining the blockade? Why not other members of the United Nations? We have been told by hon. Gentlemen on the back benches opposite that this is a United Nations crusade. Why are not other members of the United Nations assisting in this task of preventing oil going to Beira?

Assuming that this Order works, assuming that the pipeline is not sold, assuming that the blockade of Beira continues to be successful, is it worth all this trouble and expense? I ask that, because it is not the fact that oil is coming into Rhodesia from almost every other direction? It is not going through Beira, but it is coming by land through Bietbridge, through Botswana, and in other ways.

We know that the needs of Rhodesia are only 4 per cent. of the annual needs of oil fuel of South Africa. We know that we cannot stop this leak, short of war, which is what some hon. Gentlemen opposite want. Presumably that is the only way to stop it?

What about the report, not yet verified it is true, that oil has been found in the Low Velt of Rhodesia? If oil has been struck, it will make the Government look more foolish than they do at the moment.

12.31 a.m.

Sir Knox Cunningham

We were told when we passed the Southern Rhodesia (Prohibited Trade and Dealings) Order. 1966, that all the leaks had been stopped. Now we have another Order, and we are told that this will apply not only in the case of the pipeline, but to other cases which the Minister of State has in mind.

I do not want to go into the Order in detail because my hon. and learned Friend the Member for Buckinghamshire, South (Mr. Ronald Bell) has dealt with that. But what is to happen is that the Secretary of State will give directions in writing, either general or special directions. These can be revoked or varied. There can be further subsequent directions, and if they are not complied with by the individual concerned he will be liable to a fine of £500 or two years' imprisonment, or both, and what is more he will have to prove his innocence.

That is what we are being asked to approve this evening. That is what the Government have brought before the House. The House ought to realise that this is a most extraordinary Order. It will give the widest possible powers to a Minister to act, to revoke, and create directions. It will give the Minister power to create offences, and under this Order a person will have to prove his innocence.

I understand that this Order will have retrospective effect, because we were told by the Minister of State that a direction was given on 15th March, and it is now the 18th April, when we are being asked to approve this Order. It is a most sweeping and extraordinary Order for any Government to bring before the House.

12.34 a.m.

Mr. Ian Lloyd (Portsmouth, Langstone)

It is occasionally illuminating and instructive to reflect on the impotence of legislatures. This impotence is often in inverse proportion to their moral indignation on any issue. The House of Commons, not normally unwise, not normally impotent, seems, on the issue of this Order, masochistically determined to demonstrate its absolute impotence, to advertise it, one might say to entrench it, in the log book of history.

This flows not from the rightness or the wrongness of this Order—and there are obviously many views on this—or from the moral attitudes which underlie it, or, indeed, which are presumed, sometimes correctly and sometimes wrongly, to underlie the opposition to it.

It flows rather from those basic factors which have always generated impetus. It flows from the realities of economic and political power which hon. Members opposite seem strangely determined not to recognise. We are told that it is necessary to impede the sale of the pipeline. It may achieve this limited and futile end, but it will not impede the flow of oil and that, by general consent, is what matters. Nor would any Order, because of the realities of power, impede anything fundamental to the survival of the Rhodesian régime, whatever our views may be on the merits of that régime.

This is the libretto of a farce without music, for there is no music in the attempted destruction of a people, however misguided we may think those people to be.

Mr. Stanley Orme (Salford, West)

A wind instrument.

Mr. Lloyd

It is astonishing to think that the fate of a nation—for that is what we are discussing—which, as the hon. and learned Member for Northampton (Mr. Paget) has rightly pointed out, consists of two racial groups, should be the subject of mirth. It is a matter for shame.

Mr. Andrew Faulds (Smethwick)

And so is the hon. Member's speech.

Mr. Lloyd

This is a libretto marking a schizophrenic permanence in the separation of the House of Commons from the powers it can expect to exercise in subjects of this kind.

12.37 a.m.

Mr. David Steel (Roxburgh, Selkirk and Peebles)

An earlier speaker from the Conservative benches deplored the fact that there were so few Members here at this hour to listen to the debate on this important Order. I am surprised that so many hon. Members bother to come time after time to listen to the same speeches from the same irresponsible minority of the Conservative Party who are the self-appointed apologists for the rebel régime in Rhodesia.

With great respect to the right hon. Member for Bridlington (Mr. Wood), who usually approaches these things with greater moderation and care than his colleagues, I do not agree that this Order is less significant than that which we debated earlier. I think that it is far more significant.

Even if it did not go beyond the possible sale of the Lonrho pipeline, that would be justification enough for the Order. It is, nevertheless, true that the pipeline could be taken over, but only by a process of confiscation. Certainly, it could not be taken over legally. Moreover, it might well be that this Order will be required to be brought into operation in other cases.

To take a hypothetical example, there is the possible sale of ships to those international gangsters who exist and are only too anxious to exploit this situation, as they would exploit any for the sake of profit. If it came to a British company selling a ship to such an organisation for the purpose of avoiding sanctions, it might be that one case would slip through the net of prior notification which the Government require, but then a general direction would be issued under this Order so that no repetition would take place by the same company.

Mr. Biggs-Davison

Can the hon. Gentleman explain how an illegal régime in Rhodesia can possibly take over a pipeline in Mozambique?

Mr. Steel

I was not referring to the section of the pipeline which goes through Mozambique.

Mr. Paget

When the hon. Gentleman speaks of a general direction about the selling of ships, what would that general direction be? Would it be not to sell ships, in which case the Order is a good deal wider than anybody, even its strongest supporters, thought it to be? Would it be not to sell ships to particular buyers, in which case if it was wanted to sell ships, a new company would be able to sell them?

Mr. Steel

I dare say that every effort will be made to avoid this Order, as every effort has been made to avoid every other Order and every step taken by the Government to implement sanctions. That does not seem to be a good reason for not at least attempting to make sanctions effective. This all along has been the argument of those who at heart want the Smith régime to get away with it and who want to sit by and do nothing.

If the Government deserve criticism it is because they have required prodding and stiffening in their policy, because, if anything, they have done everything too little and too late. The last people to whom they should listen in discussions of Orders of this kind are those who would do even less even later.

12.42 a.m.

Mr. William Molloy (Ealing, North)

The speech of the hon. Member for Rox- burgh, Selkirk and Peebles (Mr. David Steel) was so refreshing that I find myself bound to give him some support. All the arguments which we have had from hon. Members opposite tonight—I do not think that I can include right hon. Gentlemen opposite—have seemed to be intended to be based on what was constitutionally right and proper. The purpose of the Order is to help to break down a régime which is hostile to the Crown and the constitution of this country. Yet hon. Members opposite have been putting forward arguments which would destroy the constitution of this nation, and they have done so in support of a rebel régime. That must mean that they are in direct opposition to the Crown and constitution of this country.

I know that such a purpose will bring smiles to the faces of some hon. Members opposite, but the official Tory Opposition have to face the fact that the Order supports international law, the fact that we are discussing the British constitution. One would have thought that senior members of the Opposition would have been present tonight to deplore the attitude of some hon. Members opposite. I believe that their absence shows that they are ashamed of their hon. Friends.

I hope that tonight the House will decide to support not only the traditions and constitution of this country, but, once again, will support the only thing which can save mankind, which is some form of international law such as the United Nations of which so many in the Tory Party seemed to have a built-in hatred. If there is any form of masochism on which hon. Members should concentrate, it is that form of masochism, because they could destroy not only themselves but humanity. The Order could be as important as that in demonstrating what issues are involved, because next time there might be an issue bigger than that of Rhodesia.

Mr. Speaker

It will not be discussed on this Order.

Mr. Molloy

I was only giving you fair warning, Mr. Speaker. I hope that the House will decide to support the constitution of this country and the overwhelming majority decision of the rest of the world and accept the Order.

Mr. Edward M. Taylor (Glasgow, Cathcart)

The hon. Member for Roxburgh, Selkirk and Peebles (Mr. David Steel) complained about the speeches from this side of the House. He seemed to feel that they were inappropriate to the occasion. May I say, in all sincerity, that there are some of us on this side who are becoming a little disgusted about the way in which some hon. Members are parading their consciences before an international audience, knowing well that all their paper aeroplanes and cardboard soldiers will have as much effect on the situation in Rhodesia as would an Order dealing with the parking problem on the moon.

We all know that we are indulging in nonsense in passing this and other Orders. It is quite clear that the hon. Gentleman and others obtain a great deal of satisfaction in passing them, when they know that they will be meaningless. It is quite clear that we now have no practical control over the situation in Rhodesia. This is what we should be turning our minds to. This Order, and the other that we have debated tonight, will have no practical effect. In these circumstances, it is just a piece of nonsense to pass them at all.

The obvious reason is to absolve the splendid conscience which the Government demonstrate from time to time; they must be seen to be doing this before an international audience. To do so, they bring forward little pieces of paper, to try to justify their position. This little Order has produced a number of interesting speeches and I think that many would have been interested in the splendid sentiments of my hon. and learned Friend the Member for Buckinghamshire, South (Mr. Ronald Bell). He said that ha wanted to dissociate himself in the most explicit manner from this Order. I agree with him.

I hope that my hon. Friends on the Front Bench will turn their minds to the possibility that the Conservative party should dissociate itself in the most explicit manner from this Order.

Mr. James Tinn (Cleveland)

Can the hon. Gentleman resolve an apparent contradiction? He agrees with his hon. and learned Friend the Member for Bruckinghamshire, South (Mr. Ronald Bell), so he says. Can he tell us how he reconciles what his hon. and learned Friend said, that this Measure is harsh and oppressive, with his own view that it is meaningless?

Mr. Taylor

I will deal effectively with that point before I sit down, and if the hon. Gentlemen has any cause for dissatisfaction, I hope that he will say so.

Some time ago we had the opportunity, on the Southern Rhodesia Act, to express our position clearly. I hope that the time will come when all these nonsensical Orders will be treated in this way—

Mr. Speaker

Order. The hon. Gentleman must come to this Order.

Mr. Taylor

This would be an excellent opportunity for us to deal generally with them. There is no question that if it had been thought that these powers would be practically applied, it would be found that hon. Members on both sides of the House would object to a gross intereference with democracy.

The powers, if they were applied, could bite extremely harshly. This Order will probably be placed in the Southern Rhodesia (Prohibited Trade and Dealings) Order, 1966, as Article 8a, between Article 8, which legalises international piracy, and Article 9, which justifies the production of documents in any circumstances, in a very unusual way.

I would suggest that if hon. Members were to look at these powers carefully, it would appear that this Government, or what we regard as the Government of Rhodesia, accepts the responsibility of seizing assets, but does not accept responsbility for paying debts. If we accept this situation, we should look at the particular provisions of the powers. We have something here which says that any transfer of assets can be interfered with by a direction which may be amended, may be changed, may be special or may be general. It is also made quite clear in Article 3 of the Order that the obligation is on the accused person to prove his innocence, and that certainly will not be very easy to do.

The argument advanced by the Minister of State for accepting the Order was based on the case of the pipeline. He must know that if ever there was a possibility of the pipeline being used, and the oil came to the end of the pipeline, it would be rather easy for the Government of the country concerned simply to nationalise the pipeline. Nationalisation is not something that I would normally support, but it is something which the Government well know can be readily done. The compensation could be on the generous side of fair, and it would be very difficult in those circumstances for the Government to object to it.

We have the other argument, about the supply of oil. I feel that the Government are making themselves look a little silly over this, because for several months they supplied the airlift for oil. We had great difficulty in obtaining the cost of that operation but eventually found that it cost the Government more than £1 per gallon to transport the oil. This transportation has now been stopped. I therefore suggest that this Order will have little or no practical effect, and that it is about time we ended this nonsense.

The serious point advanced by the hon. Member for Roxburgh, Selkirk and Peebles related to a ship. He said that the Order could be applied very effectively to a hypothetical situation involving a ship, and we know that it could be applied extremely effectively in that way if the Government intended it. But this is where we come to the real barrier between what has been said and what will, in fact, happen.

We know that Rhodesia does not have many ports open to her at this time, or at any time, and that any goods coming in would come from South Africa. But for the Government to use this Order, as they obviously could, to interfere with ships going to or from South Africa would bring them directly into conflict with South Africa and, therefore, there might be some possibility of bringing the Order to nil effect. Despite the splendid sentiments expressed by the hon. Member for Roxburgh, Selkirk and Peebles and by members of the Government here or on public platforms, the Government have not the slightest intention of coming into any form of conflict with South Africa. This Order, therefore, is the greatest hypocrisy that ever was. Even if they are prepared to voice these sentiments, it is quite clear that they will do nothing about it.

In those circumstances, how can we regard the Order as anything but nonsense and hypocrisy? The Government will be doing themselves a service if they stop bringing forward any more of these Orders but, if they do bring more forward, I hope that my hon. Friends will, in the splendid words used by my hon. and learned Friend the Member for Buckinghamshire, South, show opposition in the most obvious and explicit way by voting against them.

12.54 a.m.

The Solicitor-General

The hon. Member for Cathcart (Mr. Edward M. Taylor) doubted whether these powers would ever, in practice, be applied. The short answer to him is that they have already been applied. They were applied on the same day on which the Order was made and came into force. It may very well be that there will be other cases in which they will be applied.

The right hon. Gentleman the Member for Bridlington (Mr. Wood) said, quite rightly, that the effectiveness of this Order must depend upon prior information. I agree. Here, again, I can only answer him in general terms, because I cannot indicate the nature or sources of information. But we have a considerable volume of information about the possibility of transactions of this kind, and we are satisfied that our information is accurate. That is why we attach considerable importance to this Order.

The hon. and learned Member for Buckinghamshire, South (Mr. Ronald Bell) made considerable play with the words of the Order. He talked about contravention or evasion, but I think that the meaning is perfectly clear to the House. If a transfer such as is here contemplated is likely to defeat the purpose of the main Order, there is power to prevent it. That is a power which we say the Government should have.

The hon. and learned Gentleman and the hon. and learned Member for Antrim, South (Sir Knox Cunningham) both referred to Article 3, which deals with the onus of proof, and suggested that it was singularly oppressive. Of course, I agree that it is only in certain exceptional cases in the criminal law that the onus shifts, but there are such cases well known to the law. When dealing, for example, with the possession of explosives or dangerous weapons, the onus of showing lawful possession shifts to the defence. It is for the defence to discharge it. The defence does not, however, carry such a heavy onus as the prosecution. It only has to show a balance of probability.

If there were a charge of ignoring a direction, and Article 3 came into force, all that the director or the person concerned would need to do would be to show that he had done his utmost to comply with the direction that had been given. That is a perfectly reasonable burden to put upon him in the circumstances that prevail. Therefore, there is nothing particularly exceptional or oppressive about the Article.

But then the hon. and learned Member for Bucks, South went on to use a number of other phrases. He said that this comprised the whole apparatus of tyranny. He said that this was the latest of a series of cannibalistic self-destroying Orders in which the British people were tearing at their own vitals. He went on to announce, however, that neither he nor his hon. Friends intended to vote against the Order. I wonder how outrageous the measure would be that would provoke hon. Members opposite to go into the Lobby.

We do not have—and I say this with great respect to right hon. Members opposite—any of the leaders of the Conservative Party coming to take part in this debate. Perhaps I might quote the phrase used by David Lloyd George, in a similar case, "This is the charge of the Light Brigade".

I come now to the hon. Member for Haltemprice (Mr. Wall). Of course, the person to whom a direction is given may not be able to bring about the desired result. But he must do everything in his power to influence his fellow directors, even if the directors belong to another country, to prevent the transfer in question.

The hon. and learned Member for Antrim, South said that this was retrospective legislation. He is wrong. If he will look at the Article, and the way in which these Orders come into effect, he will see that the Order comes into operation as soon as it is made. It is true that it does not need to come for approval of the House until some time later, but there is no question here of making an Order or giving a direction until the Order is made or until it becomes effective, so there is no possible question of any retrospective legislation.

I thought that the speech of the hon. Member for Roxburgh, Selkirk and Peebles (Mr. David Steel) was very much on the point. There might well be a case in which the sale of a ship was contemplated and it is important that we should have power to prevent it. Although we are not discussing the general issue of sanctions, but only the particular points which arises on this Order, I would say how much I agreed with the hon. Member and with my hon. Friends the Members for Ealing, North (Mr. Molloy) and Sheffield, Heeley (Mr. Hooley).

What we are concerned to do here, as my hon. Friend the Member for Ealing, North said, is to support international order. In the original Order, of which this is an Amendment, we gave effect to our obligations to the United Nations as a result of the Security Council Resolution. We on this side shall go on giving effect to our international obligations.

Question put and agreed to.

Resolved, That the Southern Rhodesia (Prohibited Trade and Dealings) (Amendment) Order 1967, dated 15th March 1967, made by Her Majesty in Council under the Southern Rhodesia Act 1965, a copy of which was laid before this House on 15th March, be approved.

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