HC Deb 17 June 1976 vol 913 cc716-7
5. Mr. Tebbit

asked the Chancellor of the Exchequer if he will make a statement on the current level of sterling.

9. Mr. Rost

asked the Chancellor of the Exchequer what plans he has to stem the external exchange value of sterling.

3. Mr. Gwilym Roberts

asked the Chancellor of the Exchequer if he will carry out an inquiry into the recent fall in the value of the pound in international trading; and if he will make a statement.

Mr. Healey

I would refer the hon. Members to the answer that I gave on 7th June to the right hon. and learned Member for Surrey, East (Sir G. Howe).

Mr. Tebbit

As the pound, even after the welcome recent rise, is only just back to its level of a month ago and is still almost 10 cents below its Budget level, does the Chancellor stand by his recent opinion that sterling is under-valued? If so, has he any further measures in mind to support its value?

Mr. Healey

I think that sterling is still under-valued, but if the level stabilised at the present rate and was likely to remain stable for the next 12 months, I would not complain if it remained under-valued for a few months yet.

Mr. Cant

Does my right hon. Friend intend to verify the strength of sterling by permitting nationalised industries to borrow in Eurocurrency markets?

Mr. Healey

Nationalised industries are free to borrow in that way if they wish. I do not think that there has been a very recent borrowing in the Eurocurrency market, but there was a successful borrowing in the United States market recently by one of the nationalised industries.

Mr. David Howell

How much of the £5 billion standby credit has now been spent?

Mr. Healey

None, Sir.

Mr. Wrigglesworth

Does my right hon. Friend agree that accusations that people are speculating against sterling should be taken seriously? If they are true, should not action be taken to stop speculation? If they are false, should not that fact be revealed, so that the true causes of pressure on the pound can be discovered? Is there not a distinct need for more light to be shed on the subject?

Mr. Healey

In my answers to Questions on Monday last week I gave the best description that I was able to give of the sources of pressure on the pound. I revealed at that time that speculative pressure, in the pejorative sense to which my hon. Friend referred, played a very small part in it.

Mr. Rost

If part of the standby credit has already been drawn, and if it carries interest and has to be repaid within six months, how can the Chancellor go on pretending that it is not a loan and that it will do anything to solve our problems, when only a cut in public expenditure can do that?

Mr. Healey

I fear that the climate has infected the hon. Gentleman with a certain lethargy. The rest of the House heard me say that none of the standby credit has been spent—and none has been drawn, either.