§ Mr. DiamondI beg to move Amendment No. 12, in page 7, line 22, leave out subsection (2) and insert:
(2) The assets held in the said Department shall be valued, at market prices, at such limes and in such manner as may be agreed between the Treasury and the Bank of England, hut at least once in each financial year.This Amendment arises out of a discussion in Standing Committee when the Financial Secretary explained that the Issue Department's portfolio was and would continue to be valued on the basis of market price. My hon. Friend undertook to put down an Amendment on Report prescribing valuation at least once a year, and he undertook also to examine the possibility of a further Amendment laying down market price as the basis for that valuation. This Amendment implements both undertakings.
§ Mr. HigginsI become a little worried when the Chief Secretary describes his own speeches as clear and lucid. As he rightly said, this Amendment arises from a debate in Standing Committee on 1st February, reported at column 157 and following of the OFFICIAL REPORT. He will recall that on that occasion we pressed, first, that the figure should be published frequently—we thought at least once a year, and we are glad that he has met that point—and second, we pressed that valuation should be not as originally prescribed, which left the whole matter open as between various Government bodies, but that it should be a valuation at cost. Our original Amendment suggested that it should read:
…on 31st March at both cost and market value and published.While we welcome the Amendment, I am not entirely clear why we could not have the additional figure as well, that is, a valuation both at cost and market value. That is what we originally asked for and hoped that we might well get.173 Could the Chief Secretary therefore explain why we are not to have both sets of figures? It is very important to know to what extent the National Loans Fund is or is not making a profit on its various transactions. The variations in the values can make a considerable difference to the amount which the Fund and, in turn, the Government must borrow in the market.
§ 10.30 p.m.
§ Mr. DiamondI agree that borrowing is affected by the valuation. That is why it is necessary to put down the basis of valuation and the periods over which it will take place, but historical cost does not affect the situation. I thought that we were meeting the hon. Gentleman's essential point by describing the basis of valuation.
§ Mr. HigginsThe point is simply that it is a question of the cost of the specified asset. We shall apparently have a breakdown of the various assets held. The Fund may have purchased or sold particular assets and what it bought and sold them for and what the aggregate of the profits and losses may be, clearly mike a difference to the Fund's profits. In addition to the two points that we are glad the right hon. Gentleman covered, we hope for that additional information.
§ Mr. DiamondI shall look into this. We are in the difficulty that my hon. Friend the Financial Secretary, who dealt with the Committee stage, is unavoidably absent, being out of the country on behalf of the Government. I cannot undertake to do anything about the matter, because I understood that full consideration had been given to what the hon. Gentleman argued in Committee, and that we were meeting the essense of what he required. But I undertake to look at it, not with a view to doing anything about it, but, if necessary, having a word with the hon. Gentleman or writing to him.
§ Amendment agreed to.