HC Deb 27 July 1971 vol 822 cc197-8
16. Mr. Dempsey

asked the Chancellor of the Exchequer if he will take steps to publicise the circulation of Scottish bank notes as acceptable currency; and if he will make a statement.

Mr. Higgins

No, Sir. It is for the public to decide whether to accept Scottish bank notes; I understand they are accepted by banks and many commercial concerns in England.

Mr. Dempsey

Is the hon. Gentleman aware of the recent case of a London hotelier refusing to accept Scottish bank notes from a Scots family who came into his hotel for dinner, and that the members of that family found themselves in a London police station on a Sunday evening trying to solve the difficulty? Is the hon. Gentleman further aware that during the last four weeks a London taxi driver has refused to accept a Scottish bank note from me? Is not it about time that the Treasury took action and told these reluctant business people unequivocally that a Scots bank note is legal tender and is a perfectly acceptable means of exchange in London as elsewhere?

Mr. Higgins

On previous occasions, the hon. Gentleman has suggested that Scottish bank notes should be made legal tender. As I understand it, that is essentially what he argues now. However, in view of the numbers of different Scottish notes, I do not think that it is a move which would be welcomed by the public.

Mr. Douglas

Can the hon. Gentleman say what discussions the Treasury has had with the Scottish banks on the Government's consultative document on credit policy? Is he aware that there is a fear that, as a result of the document, there will be a reduction of the liquidity ratio of Scottish banks and a reduction of credit financing in Scotland?

Mr. Higgins

The proposals to which the hon. Gentleman has referred seek to put all banks on an equal competitive footing. Within this framework, the problems arising from the banks' note issue will receive sympathetic consideration with the aim of finding a solution which will enable the banks to continue their note issue.

Mr. Lipton

To avoid any misunderstanding, alarm and despondency, would not the simple solution be to abolish Scottish bank notes altogether? Are not Treasury notes in sufficient supply to meet all demands, even at the present deflated value of the £?

Mr. Higgins

I get the impression that that is not a proposal which would commend itself in all parts of the House.