§ 10. Mr. Martenasked the Chancellor of the Exchequer if he will make a statement on the progress made with the 2,000 million dollars credit arrangement.
§ 19. Mr. Dickensasked the Chancellor of the Exchequer if he will make a statement on the final agreement made with the Bank for International Settlements on the medium-term credit arrangement.
§ 32. Sir C. Osborneasked the Chancellor of the Exchequer what is the total sterling balance he estimates will remain after drawings have been made under the $2,000 million Basle agreement; which countries mainly will hold them, and by what amounts, respectively; whether they are all fully guaranteed in dollars against further sterling devaluation; what is the position after the 1971 guarantee expires; and what additional guarantee he has given to repay the whole amount unconditionally by 1978.
§ Mr. Roy JenkinsA full statement on the Basle facility and the sterling area agreements is contained in the White Paper which I presented to the House yesterday.
§ Mr. MartenWill the Chancellor elaborate on paragraph 13 and tell the House what is the agreed starting level of the sterling balances below which the United Kingdom can draw dollars or other foreign currencies from the International Monetary Fund?
§ Mr. JenkinsWe do not draw from the I.M.F. It is a Bank for International Settlements arrangement. The starting level is broadly the end of March level.
§ Mr. DickensIs my right hon. Friend aware that while many of us want to see changes made, in underwriting the short-term sterling balances in particular, many of us are nonetheless opposed to this Government going yet again to the Bank for International Settlements to incur new obligations to that body which recently advocated higher unemployment in Britain, reduced public expenditure, a tougher incomes policy and a revision of trade union law?
§ Mr. JenkinsI assure my hon. Friend that none of those questions arises in 183 connection with the facility which is here under discussion. My hon. Friend says that he would like to see changes but not made in the way in which we have made them. I am not quite sure in which way he would like to see changes made. I think that we have here made a practical step towards giving greater stability to sterling and, therefore, to the world monetary system by bringing in those countries which at present have large surpluses. That seems a most sensible direction in which to go.
§ Sir C. OsborneWill the £500 million surplus of which the Chancellor spoke earlier be anything like sufficient to repay the debts which we shall incur under this agreement, to repay the £2,500 million which we owe elsewhere, and to add the £500 million which he says he requires to build up the sterling balances?
§ Mr. JenkinsThe debts which can be incurred under this agreement are by definition no greater than calls which we should have had to meet earlier had sterling balances been run down without the agreement, and we incur debts under this agreement only to the extent that sterling balances are run down. If we achieve and maintain—as I am determined that we shall—a substantial surplus, we can meet our commitments over the forthcoming years.
§ Mr. MacleodWill the Chancellor recognise, particularly as he was not pressed in the matter, that he has a duty to give as much information as he reasonably can to the House. In particular, will he tell the House what drawings, if any, have been made, in view of the fact that it was widely reported in papers such as the Financial Times that about 600 million dollars were drawn straight away?
§ Mr. JenkinsAs the right hon. Gentleman knows, it is not normal to give details of drawings in respect of the Central Banks' facilities. I can, however, tell him and the House that as a result of changes in the sterling balances between the date which I mentioned to the hon. Member for Banbury (Mr. Marten) and the present time about 600 million dollars were available for us to withdraw—as a result of changes which had taken place when the agreement came into operation on 25th September.