HC Deb 13 May 1969 vol 783 cc1203-4
18. Mr. Maurice Macmillan

asked the Chancellor of the Exchequer, in view of the fact that nationalised industries are allowed to borrow long term from abroad, what steps he is taking to reduce the Government's short-term debt.

The Financial Secretary to the Treasury (Mr. Harold Lever)

I am well aware of the desirability of funding our external short-term debt over a longer period. Long-term borrowing in foreign currencies by nationalised industries has a useful part to play in this process.

Mr. Macmillan

Can the Financial Secretary give an idea of the extent to which he hopes to use this process and the rapidity with which he hopes to develop it?

Mr. Lever

That will depend on the state of the market. [Interruption.] I can inform the hon. Gentleman that we have so far obtained £30 million for the Gas Council and £7 million for B.E.A.; but what future borrowings will take place will depend very much on market conditions.

Mr. Birch

Is the hon. Gentleman aware that while Western Germany is the only place where money can be raised, we are at the same time pressing the Germans to revalue their currency, which means that this borrowing is likely to be very expensive indeed?

Mr. Lever

The point raised by the right hon. Gentleman does not hit me with a shock of novelty. The state of the currency markets is one of the factors which is taken into account when borrowing money; and, of course, the rate of interest and the length of the loan are other factors which play a part in judging whether it is dear or cheap money. The right hon. Gentleman's view is by no means final and conclusive in this matter.