HL Deb 17 August 1921 vol 43 cc943-5
THE EARL OF MAYO

My Lords, I beg to ask His Majesty's Government as to losses incurred by the State on investments made by the Government, and to move for a Return in the following form—

Income, if any, derived from—

  1. 1. £1,198,000 invested in the Commercial Bank of Siberia.
  2. 2. £656,250 given for the encouragement of the building of standard ships in the summer of 1918.
    • (This sum was invested in the Standard Ship Building and Engineering Company, Messrs. Edward Finch and Company, and the Chepstow Property Company.)
  3. 3. The Government having invested (a) £629,618 in the British America Nickel Corporation (of Canada); (b) £22,105 in the Turkish Petroleum Company; and (c) 1325,000 in the British Farina Mills, Limited.
(None of these stocks are quoted on the London Stock Exchange.)

LORD HYLTON

My Lords, in reply to the noble Lord's first Question, I have to say that no income has been derived from the shares of the Commercial Bank of Siberia, purchased by His Majesty's Government. The purchase of these shares in February. 1918, was authorised as part of the scheme for supplying funds to General Alexieff in Southern Russia. The scheme fell through owing to the spread of the Bolshevist revolution. His Majesty's Government still hold the shares, and it is possible that some day, when the economic conditions in Russia improve, they may be of some value.

With regard to the second Question, as to a sum of £656,000 given for the encouragement of building standard ships in the summer of 1918, no income is derived by the Government from this investment, The sum to which the noble Earl refers was given for the encouragement of the building of standard ships in the summer of 1918 and was invested in the Standard Shipbuilding and Engineering Company and the other companies to which he refers All the shares in these three companies were purchased by the Admiralty with Treasury approval on August 9, 1918, in connection with the scheme for the construction of the national shipyard at Chepstow. In the quarterly Return of Government Investments in Registered Companies (which is presented by the Treasury to an Order of the House of Commons dated March 30, 1920) for the quarter ended June 30, the following observation is made:— These shares are of nominal value only as the entire assets and liabilities of the companies are vested in the Board of Trade. For any further information with regard to this investment I refer the noble Earl to the Third Report of the Committee on Public Accounts.

Then with regard to the investment in the British America Nickel Corporation of Canada. The sum of over £629,000 represents approximately three million dollars, which were originally advanced by the Government to this company upon the security of the first mortgage gold bonds of the Corporation. This amount was advanced during the war in compliance with the terms of a certain blockade arrangement entered into with a Norwegian company in order to prevent the supply of nickel to Germany. The Norwegian company were largely interested in the British Nickel Corporation, who were in need of funds to develop the undertaking. For various reasons the company has been obliged to reconstruct, and the bond holders have accepted income bonds in exchange for their previous holdings in the company. The Government are still in possession of these income bonds and look on this as by no means a desperate debt.

With regard to the Turkish Petroleum Company, the Government holding now amounts to £40,000, the uncalled balance of the shares having recently been called up. The Turkish Petroleum Company own certain concessions in Mesopotamia and Asia Minor in respect of oil which may be found within the districts covered by these concessions. Here again it is possible that they may prove to be of value.

The last Question concerns the British Farina Mills. The affairs of this company have bee n the subject of investigation by the Public Accounts Committee, who have considered the question at some length. If the noble Earl will look at the Report. of the Select Committee on Public Accounts, presented to the House on the ninth of this month, he will find a summary of the conclusions of the Committee as regards this particular investment. The Committee say:— In our opinion this is another ease of a war measure, entered upon in a time of great emergency for the increased production of food, which owing to the termination of the war and other reasons his failed to realise expectations. Considering tie difficulty of the conditions we do not see that any grounds for censure exist.

THE EARL OF-MAYO

That was to make potato flour?

LORD HYLTON

Yes.

THE EARL OF MAYO

None of these are quoted on the London Stock Exchange?

LORD HLTON

My noble friend is quite correct.

House adjourned during pleasure.

House resumed.