HL Deb 13 July 1908 vol 192 cc353-6
*LORD CLONBROCK,

who had the following Question upon the Paper— To ask His Majesty's Government for the following information relative to the working of the Irish Land Act, 1903; (1) Why the recent issue of £5,000,000 in Guaranteed 2¾ per cent. Stock was not made to the National Debt Commissioners at the certified price of, the day in accordance with the practice which has been followed since June, 1906, as mentioned in Paragraph 35 of the recent Report of the Departmental Committee of the Treasury [Cd. 4005], and the continuance of which practice is recommended in Paragraphs 84 and 85 of that Report. (2) What is (approximately) the extra annual charge which will be thrown upon the Ireland Development Grant by this £5,000,000 having been issued to the public at 89½, instead of being made to the National Debt Commissioners at the certified price of the day? (3) Have the Government definitely abandoned the practice (which originated with themselves) of making these issues to the National Debt Commissioners, and, if so, why. (4) How much of the proceeds of the recent issue of £5,000,000 Stock will be immediately absorbed by claims already existing, viz.: 1. Repayment of temporary loans made under Section 30 of the Act, or otherwise, and not yet repaid; 2. Sums immediately required to meet: (a) Advances already sanctioned for direct sales under Sections 1 to 5 of the Act; (b) advances already sanctioned for purchases under Sections 6, 7, and 8 of the Act; (c) advances immediately payable to the Congested Districts Board for any purpose; (d) any other advances that are immediately payable out of the Irish Land Purchase Fund— said: My Lords, in putting the Question standing in my name, [should like to say a very few words in explanation of their objects. The first paragraph refers to the issue lately of £5,000,000 Guaranteed Land Stock, and the object of that part of the Question is to know why this was issued to the public at 89½ instead of the usual practice being followed of the issue being made to the National Debt Commissioners. Ever since the month of June, 1906, this has been the practice. It is so stated in the report of the Departmental Committee of the Treasury, and they not only recommend this in paragraph 84 for the future, but state in the following paragraph that it seems reasonable to suppose that the National Debt Commissioners would be in a position to lend £5,000,000 a year. The difference is very considerable. Immediately preceding the issue of this loan Land Stock stood at 91¾ to 92, and the issue was made to the public at 89½. I have no doubt there is some good reason for it, for the Government would naturally like to obtain money on the best terms they could, but at the same time we should naturally like to know why it was done, and also whether the same practice is to be continued in the future, and what amount would be thrown on the Irish Development Grant by issuing the loan in this manner instead of at the price of the day. The remaining part of my Question refers only to what amount of this loan will be available for purchase. I wish to know what claims are already made: (1) For direct sales to tenants; (2) for sales to the Estates Commissioners; and (3) for money that has to be paid to the Congested Districts Board and for any other advances that have to be made.

LORD DENMAN

My Lords, the Answer to the first Question the noble Lord has on the Paper, as to why the issue of stock was not made to the National Debt Commissioners, is very brief. Because the National Debt Commissioners have no funds, unfortunately, and therefore the noble Lord will agree that they cannot advance the money, with the best wishes in the world. Going to Question 3, he asks: "Have the Government definitely abandoned the practice of making these issues to the National Debt Commissioners?" I am afraid I am unable to make any definite announcement on that point. Then in Question 2 he asks what is the loss thrown on the Ireland Development Grant by this issue of stock. The loss incurred is £3,300 annually. Then he asks as to the repayment of temporary loans made under Section 30 of the Act, and not yet repaid. The amount temporarily purchased under this section of the Irish. Land Act amounts to £1,927,000. Then with regard to the other Question the Commissioners have sanctioned advances amounting to £956,659 in direct sales, of which £266,438 will be advanced on the 16th instant, and the remainder as soon as outstanding questions of title have been disposed of. Under Sections 6, 7, and 8, the Commissioners have agreed to buy estates, the purchase money of which, amounts to £637,779, of which £55,624 will be advanced on the 16th instant, and the remainder as soon as the vendors have shown title and are in a position to allocate during the present sittings Under Section 2 of the evicted Tenants Act, 1907, the Estates Commissioners have made offers for estates the purchase money of which amounts to £47,851, which will be advanced when the requirements of the statute have been complied with. Under Sections 72 and 79 the Congested Districts Board have agreed to buy estates, the purchase money of which amounts to £35,374, which will be advanced as soon as the vendors have shown title and are in a position to allocate during the present Trinity Law Sittings. That brings the total to £1,677,663. Now, the total advances on the 16th instant, which the noble Lord desired to know, are as follows:—By the Estates Commissioner £322,000; by other Commissioners, £3,000; under the Labourers' Acts, £7,000; and for bonus, £18,000; making a total of £350,000. The Law Sittings of the present Trinity term terminate at the end of this month, after which, advances cannot be made until the Courts resume their sittings and solicitors are in attendance. Possibly £500,000 may be required for all the purposes above stated on the 31st of this month, provided the vendors' solicitors are prepared to close their oases. It is not possible to forecast what moneys may be required in the interval from 31st July to 1st October, 1908, but judging from last year, £41,280 was drawn for advances under the Labourers Act between the end of July and the 1st October and £170,000 was drawn for bonus under orders made in Court prior to the 1st August. I think that gives the bulk of the information which the noble Lord desires.

VISCOUNT ST. ALDWYN

I am not surprised that my noble friend (Lord Clonbrock) should have asked His Majesty's Government why this loan was issued at the fixed price of 89½ instead of being issued to the National Debt Commissioners at 92, which was the certified price of the day. Of course the result will be a very considerable loss to the Irish Development Grant, and indirectly to the Irish ratepayers. I have had unfortunately perhaps more experience in the issue of Government loans than any Chancellor of the Exchequer for the last 100 years, and although I daresay I made some mistakes in connection with that important and responsible office, I do not think anybody ever accused me of issuing Government loans at too low a price to the public. I believe that I succeeded in securing a fair price for all the loans that I issued. Now, having had that experience, I will venture to say that it is my decided opinion that His Majesty's Government have issued this loan at too low a price. I believe that they might very easily have obtained something like ¾ per cent. more than they did. They issued the loan at a fixed price of 89½, as I have said, when similar stock in the market stood at 92, and when the market was a rising one. If they had issued this loan at a minimum price of 89½ I feel convinced they would have had tenders for it which would have made the average price probably as much as 90¼. I do not consider that good finance. I have no doubt the Chancellor of the Exchequer went to the experts for his I advice, as any Chancellor of the Exchequer naturally would; but my experience has been that experts are apt to be over-cautious in these matters, and although I have had to do with very large sums of this kind, and it would have been a very serious matter for the country if any of the loans issued during the South African War had failed, I took upon myself the responsibility of issuing loans at a higher price than the experts advised.