HC Deb 22 May 1980 vol 985 cc698-9
8. Mr. Nicholas Winterton

asked the Chancellor of the Exchequer if he will set up a unit to monitor the issue of new money.

Mr. Lawson

No, Sir.

Mr. Winterton

I hardly heard that brief reply. Does my hon. Friend agree that it would be of great benefit to Britain if a unit were set up completely apart from any British Government to monitor the issue of new money, so that British Governments of either party could not print new money close to an election time to build up their election promises to the electorate, which would in the long term do great damage to the economy, and could not print post-dated cheques, an activity which was so typical of the previous Government at the general election?

Mr. Lawson

I fully understand what has prompted my hon. Friend to make that suggestion. However, I think that it would be wrong to take monetary control out of the hands of the elected Government and Parliament. Nevertheless, it is incumbent upon Governments to be responsible in monetary matters; and this Government are responsible.

Mr. Skinner

If the Government will not set up a unit to monitor the issue of new money, will the hon. Gentleman explain to the House why it was that a few weeks ago the Treasury formed a unit or consortium which represented the form of a lifeboat for Stone-Piatt to bail it out and provide it with new money? I think that he has a duty to tell the House why he intervened on that occasion.

Mr. Lawson

The hon. Gentleman is misinformed. The Treasury had nothing to do with Stone-Piatt.

Mr. Skinner

The Governor of the Bank of England was there.

Mr. Lawson

The Governor intervened, but that is a different matter.

Mr. Neubert

As it is nearly 10 years since decimalisation, is it not ironic that new money continues to be denominated in new pence? Is it not time for changes in our currency? Would not at least the removal of the misnomer "new" be a modest start?

Mr. Lawson

My hon. Friend has a good point. However, legislation would be required to make the change. Legislative priorities will decide when such a measure should find its place in the queue.

Mr. Denzil Davies

I revert to the question of my hon. Friend the Member for Bolsover (Mr. Skinner) on the Stone Platt issue, which was interesting and important. Will the hon. Gentleman con firm or deny that Treasury Ministers approved—

Mr. Skinner

They did.

Mr. Davies

—the rescue operation taken by the Bank of England?

Mr. Lawson

I think that the right hon. Gentleman has been in this place long enough to know that he should table a question on the Order Paper when he wishes to raise such a matter. His supplementary question has nothing to do with the question of my hon. Friend the Member for Macclesfield (Mr. Winterton). [HON. MEMBERS: "Answer".] However, from my knowledge it appears to me that the Governor of the Bank of England behaved in a constructive manner.