HC Deb 28 March 1972 vol 834 cc226-7
Q3. Dr. Gilbert

asked the Prime Minister what actions, following his recent discussions with M. Pompidou, he proposes to take with respect to international monetary matters.

The Prime Minister

We shall proceed with discussions on international monetary reform both in the I.M.F. Board and with other Governments. We welcome resumed progress towards economic and monetary harmonisation in Europe in which we intend to play a full part.

Dr. Gilbert

I thank the right hon. Gentleman for that answer. In the light of the present level of British reserves and recent upheavals in international markets, is it the Goverment's view that our present level of reserves is high enough. Does the right hon. Gentleman propose to take any steps to prevent further accretions of dollars in them?

The Prime Minister

We have no plans to take further steps at this moment. As the hon. Gentleman knows, we are hopeful that the United States Government will be able to agree to a measure of convertibility so far as the I.M.F. is concerned. This will then enable us to repay the outstanding tranche of our debt.

Sir B. Rhys Williams

Would my right hon. Friend consider this an opportune moment to take the initiative for the setting up of a European fund for monetary co-operation?

The Prime Minister

There is already in the Community a fund for this purpose, particularly for the short- and medium-term measures. This is a matter which I am sure will be discussed at the summit to be held in October.

Mr. Cant

As a supporter of the Common Market, may I ask the right hon. Gentleman how he reconciles the statement made after his meeting with M. Pompidou—that there would still be a place for gold in an international monetary system—with the desire of the United States to demonetarise gold, even by selling it on the free market?

The Prime Minister

That statement related to the sort of new monetary system we would like to see develop, which would include S.D.R.s and provide a place for gold. Already, in the present situation, countries are finding that difficulties arise from non-convertibility of any kind.

The answer to the last part of the hon. Gentleman's supplementary question is that I have only seen the Press reports to which he is no doubt referring. I have no information about them.