- 1. Whether the revenues in Palestine assigned to the holders of Turkish bonds under the Decree of Muharrem, and collected by His Majesty's Government from the middle of 1918 until the end of 1920, were placed to a special account separate from the Government's other revenues; whether interest was credited on the amount deposited; and whether at that time His Majesty's Government did not regard the said revenues as belonging to the bondholders.
- 2. Whether the statement made by Lord Arnold in this House, on May 21, that the, revenues collected by His Majesty's Government were not remitted to the Debt Council at Constantinople because the. Debt Council was composed of enemy members is correct, seeing that all enemy representatives on the Council left Constantinople at the end of 1918;
§ The noble Lord said: My Lords, I hold in my hand the Report of the Iraq Administration from October, 1920, to March, 1922. On page 37 of that Report I find under "Receipts and Expenditure by main heads," and included among the receipts: Ottoman Debt Revenues, 24,09,558 rupees, which I venture to say is evidence that at that moment those revenues were collected as being revenues assigned to the Ottoman Debt Redemption. Therefore, at that time the Government was aware of the claims of the Ottoman Debt bondholders to these revenues, and they actually set them aside in a separate account for the credit of the bondholders. I see that the noble Lord, Lord Arnold, on Wednesday, July 2, in reply to a question by my noble friend Lord Raglan, stated that from March, 1920, certain payments were going to be made under the Treaty of Lausanne to the bondholders. That has nothing whatever to do with the Question I am asking His Majesty's Government, because the Question I am asking is not whether the Treaty entered into at Lausanne is going to be observed, but whether or not before a certain date the Palestine Government did not appropriate certain moneys which belonged to other people, and which they knew belonged to other people, because they put them into a separate account, and whether they will not make restitution for the wrong that they have done.387
§ THE UNDER-SECRETARY OF STATE FOR THE COLONIES (LORD ARNOLD)
My Lords, in reply to the first part of the noble Lord's Question, the assigned revenues collected by the military authorities in Palestine were placed to a special account, separate from the other revenues, and for some time interest was credited on this account. The object of placing these revenues to a special account was statistical—that is to say, the object was to keep a record of the amount collected. It was not intended that the authorities in Palestine should be debarred from using the proceeds of these revenues to meet expenditure. His Majesty's Government did not at that time, or at any later time, regard these revenues as belonging to the bondholders, but their view was that the question whether an amount equivalent to the, proceeds of these revenues would have to be reimbursed to the Ottoman Debt Council after the war was one which it was impossible to decide until the Treaty of Peace had been settled.
As I explained in my reply on May 21, the Treaty of Lausanne fixed March 1, 1920, as the date from which Palestine has to assume responsibility for a portion of the pre-war Ottoman Public Debt, but does not place upon Palestine, or upon His Majesty's Government, any liability to reimburse to the Ottoman Debt Council the amount of the assigned revenues collected after the occupation of Palestine by British military forces. His Majesty's Government are advised that apart from the Treaty no such liability exists.
In reply to the second part of the noble Lord's Question, what I said in my statement on May 21 was this:—The British military authorities when they occupied … Palestine kept separate accounts of the proceeds of the assigned revenues. There was, of course, no question of actually paying over these revenues to the Ottoman Debt Council at Constantinople which then consisted of enemy nationals.It will be seen that I was referring to the period of British military occupation during the war, and not to the subsequent period after the Armistice. During the war there was, for the reason which I have explained, no necessity to consider the question whether the proceeds of the, assigned revenues collected should be paid to the. Ottoman Debt Council. After the 388 cessation of active hostilities by the Armistice of October 30, 1918, the German and Austro-Hungarian representatives on the Ottoman Debt Council left Constantinople, as the noble Lord correctly states in his Question. The question then arose as to the reimbursement of the proceeds of these revenues, and the view taken was, as I have already stated, that the matter could not be settled until the terms of the Treaty of Peace had been decided upon, and the view taken later on, when those terms had been decided upon, was that there is no liability to reimburse the proceeds of these revenues. I would, in conclusion, remind your Lordships that, as I stated when the noble Lord raised this subject on May 21, the position of the present Government is that it adheres to what was done and arranged by their predecessors in regard to these matters.
§ LORD BANBURY OF SOUTHAM
My Lords, I am much obliged to the noble Lord for his reply. I am sorry that it does not give me very much satisfaction, because, as I understand it, the noble Lord adheres to the taking of money which belonged to somebody else—which he does not deny belonged to somebody else, and which he admits was put to? separate account—and devoting it for purposes for which it was not intended, because a Treaty subsequent to the taking of the money did not say the money should be handed over to the rightful owner. Whatever Government supported that. I am sure that on reflection the vast majority of people will say that it is a proceeding which ought not to have taken place.
My Lords, may I point out in addition, that Palestine was, and I believe technically still is, occupied enemy territory, because the Treaty of Lausanne has not been ratified? Therefore, the Government has no power to allocate the revenues of the country.