HC Deb 26 November 1968 vol 774 cc269-70
1. Mr. Ridley

asked the Chancellor of the Exchequer if he will make a statement on his recent negotiations with the Government of the Federal Republic of Germany, in particular with regard to the continuing balance of payments surplus run by the Federal Republic.

The Chancellor of the Exchequer (Mr. Roy Jenkins)

I have nothing to add to my statement on 22nd November about the discussions at the Group of Ten meeting in Bonn.

Mr. Ridley

Did the Prime Minister really tell the German Ambassador that he would have to take action in regard to defence if the mark was not up-valued? Will the Chancellor consider letting the exchange rate float after this traumatic experience in the last year or two?

Mr. Jenkins

In reply to the second part of that supplementary question, I made it absolutely clear in my statement on Friday afternoon and again yesterday that we are determined to maintain the parity and will take, and have taken, all necessary measures to that end.

In reply to the first part of the question, communications between Governments are always confidential. As to matters of the conference, Professor Schiller, as Chairman, at the beginning of the conference asked that in view of the seriousness of the issues involved a high degree of confidentiality should be accorded the proceedings. Therefore, I assume that nothing that has emerged could come from the German Government, and I propose to observe that confidentiality.

Mr. Dickens

Does the Chancellor appreciate that many of us on these benches feel that the attitude of the West German Government at present is one of arrogance and selfishness? Is not my right hon. Friend aware that some of us want the Government to aproach Mr. Schweitzer at the I.M.F. with a view to bringing pressure to bear on the West German Government because they are maintaining a very high surplus on balance of payments, and this is a crime against world trade? Secondly—

Mr. Speaker

Order. The hon. Gentleman must learn to put brief questions.

Mr. Dickens

I shall complete my question as rapidly as possible, Sir. Should not the Government now take steps to reduce the cost of the British Army of the Rhine by withdrawing, say, a token force of 10,000?

Mr. Jenkins

I indicated yesterday that I thought that there are obligations upon surplus as well as upon deficit countries. As 1 said on Friday in reply to my hon. Friend, we have considerable problems in the international monetary system at the moment. These can be solved only by international co-operation, and I do not think that it helps to achieve this by using language of that sort against anybody.

Mr. Patrick Jenkin

Does not the Chancellor agree that, at a time when we are trying to achieve a surplus, it cannot help to use language such as that which the hon. Member for Lewisham, West (Mr. Dickens) has used?