HL Deb 23 March 1922 vol 49 cc883-90

LORD LAMINGTON had given Notice to move, That His Majesty's Government take any steps that are necessary to prevent a loan in any form being raised in this country on behalf of Greece, so long as that country continues to be at war with Turkey. The noble Lord said: My Lords, the Motion which stands in my name on the Paper, owing to the long debates on the Irish Bill, had to be postponed till to-day, and since I put it down events have considerably changed in respect of the subject-matter of it. I think that events, on the whole, are so changed that it ought to be more easy for the Government to accept the Motion. In to-day's newspapers it is stated the Secretary of State for Foreign Affairs, the Marquess Curzon of Kedleston, has made a proposal for an armistice as between Greece and Turkey for three months, and that his colleagues at the Conference have unanimously accepted that proposal. A telegram has been, or will be, sent to Athens, Constantinople, and Angora suggesting that an armistice be made for a period of three months from a certain fixed date. It is very satisfactory to find that in these questions we are acting in concert, particularly with the other member of the Entente, France.

In The Times to-day there is a long statement on the question of the Near East. It is pointed out in that statement that a great deal of uncertainty has arisen in the minds of the French owing to a belief that we have secret commitments with Greece. The Times correspondent points out that to secure absolute co-operation and co-ordination with France it is essential that this suspicion should be dispelled. I therefore hope that the cablegrams sent to the places I have mentioned mean that we are acting in hearty accord with France on this question.

In regard to the history of this matter, I may say that after the death of King Alexander, when M. Venizelos was dismissed from office and King Constantine was again placed on the throne of Greece, there was then an opportunity for this country to have cleared up the whole situation in the Near East. That opportunity, very lamentably, was not taken advantage of. We then propounded two points of policy. One was that we should observe absolute neutrality between Greece and Turkey when hostilities broke out, and also, owing to the dismissal of M. Venizelos, who had been acting as a very faithful ally during the great war, that we should establish a financial blockade as against Greece. What one wants to know is why was that blockade ever withdrawn. When I raised this Question about a fortnight ago in your Lordships' House, the reply given by the noble Earl, Lord Crawford, was to the effect that this Government never prevented any other country from obtaining loans in the City. At the same time he had to mention that there was no possibility of loans being obtained in the City unless adequate security could be given, and that was not possible in the case of Greece, because her security had already been pledged.

But the Government so far departed from an understanding arrived at with France and the United States that the securities which had been assigned to a loan made by the United States were released so that thereby Greece might be able to obtain money from the City. She made the attempt, but the City would not agree to make the loan. The noble Earl went on to recall that there was, under the Trade Facilities Act, an Advisory Committee set up to which other countries could apply for monetary assistance, on the understanding that the money so obtained should he entirely spent in this country. Personally, I thought that a most futile policy. The idea was that this money would be spent to relieve unemployment here, but as Greece was practically bankrupt it was in her case a perfectly delusive security, and we were simply lending money to ourselves. Greece, however, did apply to the Advisory Committee and she was refused. She applied a second time, and the application was, after a time, withdrawn. Lord Crawford went on to say that if she applied again no doubt the Advisory Committee would consider the application on its merits, and that the loan of £15,000,000 might be granted.

About three weds ago a reply was also given in another place that there was no application by Greece before that Advisory Committee; yet ten days ago I read in the Press that M. Gounaris, the Greek Prime Minister, at the National Assembly, discussing the whole financial position of the country, recalled the agreement of December, 1921, with the British Government, by which the latter consented to the issue of a Greek loan for £15,010,000, which was to be used chiefly for purchases in the British market. Negotiations for this loan were so far advanced that nothing was required but its acceptance by the International Commission of Revenue Control, who would be responsible for the administration of the loan, and the consent of the American Government. I do not know which is the accurate report.

It was stated here that there was no application about a fortnight or three weeks ago; yet M. Gounaris, ten days afterwards, says that they are on the point of getting the loan. Perhaps the noble Lord who is to reply will be able to throw some light on these contradictory statements. I see he shakes his head; I am very sorry, because one does not know what to believe. My point is that the Government have not been unwilling to provide funds for Greece, notwithstanding the statement that we intended to preserve absolute neutrality between Greece and Turkey. It is obvious that although this money must be spent in this country, you cannot limit the effect of the operation of a money grant, and Greece would certainly derive fresh sinews for war against Turkey from it, no matter on what the money was spent. We should, therefore, be departing from our declaration of strict neutrality.

In 1918 a loan was made by ourselves, the United States and France, providing Greece with £10,000,000. France did not act on the undertaking, but the United States provided about £6,000,000 and this country £4,000,000, on the understanding that the securities would not, in any way, be touched until the advances had been repaid by Greece. Our Government gave way on the point, and released the securities in order to provide Greece with the means of obtaining a further loan, but to this day the United States has never raised her embargo, and we, therefore, cannot furnish funds to Greece because the United States will not allow it. I believe France takes the same view, although I do not quite know how she stands in the matter.

I do not think it is fair to Greece to treat her in this way. You are dilly-dallying with her, and all the time you know that it is perfectly impossible to provide her with money. Mr. Montagu, in the statement he made after his resignation, said— I have never been able to understand from what motive his"—(the Prime Minister's)—"pro-Greek policy was dictated. Pro-Greek it is called. I do not believe it is in the interest of the Greeks. I do not know in whose interests it is. I am certain it is calamitous to the British Empire. I quite agree with him in that statement. I cannot conceive why you should pretend to help Greece when you know you cannot do it. But what is still more serious is that by this pretence of affording financial aid you incur the resentment and animosity of Moslems throughout the world. I know from very good authority that they are very sore on this point. All the time we have been pretending to observe strict neutrality between Greece and Turkey we have been negotiating, quite unfruitfully, to provide Greece with funds, and it has rankled in the minds of Moslems and created a dangerous feeling against us.

I am not influenced by any hostility to Greece. I do not want to prevent her getting funds when she has made peace with Turkey. I should be willing for her to have £15,000,000 if she would clear out of Asia Minor, but do not let us go on, for some mysterious reason, allowing her to believe that we are going to help her when all the time we cannot do it. My main point is that in assuming this attitude we have created a dangerous feeling against us amongst our Mahomedan fellow subjects, and I hope that His Majesty's Government, having in accord with France and Italy tried to get an armistice between Greece and Turkey, will agree to the Motion I have placed on the Paper.

Moved, That His Majesty's Government take any steps that are necessary to prevent a loan in any form being raised in this country on behalf of Greece, so long as that country continues to be at war with Turkey.—(Lord Lamington.)


My Lords, I understand that about a fortnight ago the noble Lord raised this Question in this House and that as full a reply as was possible was given by the noble Earl who acts as Deputy Leader of the House. This evening I am able only to attempt to clear up, on behalf of the Treasury, a slight misconception that appears to have arisen in his mind as to the "steps that are necessary to prevent a loan in any form being raised in this country on behalf of Greece so long as she continues to be at war with Turkey." The facts of the case are these. Your Lordships are probably cognisant of the fact that there is no Government control over capital issues on the London market, and His Majesty's Government have repeatedly declared it to be their policy to let trade and finance manage their own affairs. There is no power, since the death of the late lamented D.O.R.A., to impose control without obtaining special legislation. Therefore, the Government cannot take steps, in general terms, to prevent a loan to Greece. The matter is one for the judgment of the London market.

At the same time, it is only right I should admit that in the case of Greece there was the special point that the consent of His Majesty's Government was required for the assignment of securities for a foreign loan by the Greek Government, while the war advance to Greece by this country and its Allies remained unpaid. But on December 21 last—and this is no new information given to Parliament, because a statement was made by the Chancellor of the Exchequer in another place some time back which can hardly have escaped the noble Lord's attention—an Agreement was signed in Paris by the Chancellor of the Exchequer on behalf of His Majesty's Government, and by the Prime Minister of Greece on behalf of the Government of the Hellenes, whereby His Majesty's Government granted its consent to the assignment of securities for the loan which the Greek Government were then seeking to negotiate, up to a total of £15,000,000.

His Majesty's Government, clearly, cannot repudiate that Agreement, and, there- fore, I must confess that I cannot understand how His Majesty's Government are to take the steps the noble Lord suggests. The Agreement was signed on December 21 last, giving these powers to the Greek Government to the total of £15,000,000. My noble friend will, of course, be in order in moving a vote of censure on His Majesty's Government for having signed that Agreement, but I do not know what steps could be taken now to prevent what His Majesty's Government have already sanctioned so far back as December 21 last. My noble friend refers to a statement made by M. Gounaris in the Greek Parliament. It is impossible for me or any other member of His Majesty's Government to hold himself responsible for or to explain any statement made by M. Gounaris, or any other Greek Minister.


It was a direct contradiction of what was said here.


What M. Gounaris said is a matter for which M. Gounaris must be responsible, and not His Majesty's Government. As regards the Trade Facilities Act to which my noble friend referred, I am informed that the application for the guarantee of a loan has been withdrawn, so that no question arises on that score. My noble friend alluded to the announcement in the newspapers that suggestions have been made for the signature of an armistice between Greece and Turkey. I have no doubt that at the proper time information will be afforded by His Majesty's Government on that point. But this evening I am merely endeavouring, on behalf of the Treasury, to explain the facts respecting the Agreement signed between His Majesty's Government and the Greek Government, and I am afraid that is all the information I can give my noble friend.


I thank my noble friend for his very official answer, but it does not meet my point in the slightest degree. How would you be breaking faith with Greece You broke faith with the American Government in 1918, when money was advanced to Greece by America, ourselves and France, who later withdrew from the arrangement. It was advanced on the undertaking that securities should not be assigned away. We have now told Greece that they can borrow more money. The whole of the noble Lord's answer was strictly official, and it does not meet my point. By behaving in this way you have created an extreme feeling in the Mahomedan world that you have broken faith. And for what? Not for the Greeks. Indeed, nobody knows why. I have quoted Mr. Montagu, who ought to know why it was done. The effect of it, at any rate, has been to create very hostile feeling towards our country as one which cannot

Resolved in the negative, and Motion disagreed to accordingly.

be trusted to keep its word. I feel very strongly on this point, and I am afraid I must put your Lordships to the trouble of a Division.

On Question, whether the Motion shall be agreed to?

Their Lordships divided:—Contents, 10; Not-Contents, 15.

Doncaster, E. (D. Buccleuch and Queenoberry.) Bellew, L. Mowbray, L.
Fairfax of Cameron, L. Nunburnholme, L.
Morton, E. Fingall, L. (E. Fingall) Raglan, L.
Lamington, L. [Teller.] Redesdale, L. [Teller.]
Sutherland, D. Onslow, E. Lee of Fareham, L.
Ancaster, E. Strafford, E. Rotherham, L.
Bradford, E. [Teller.] Annesley, L. (V. Valentia.) Somerleyton, L. [Teller.]
Chesterfield, E. Colebrooke, L. Stanmore, L.
Lucan, E. Hylton, L. Wigan, L. (E. Crawford.)

House adjourned at half-past seven o'clock till Monday next, a quarter past four o'clock.