HL Deb 14 May 1957 vol 203 cc633-42

2.38 p.m.


My Lords, although the Prime Minister made a statement in another place yesterday of which your Lordships are aware, I think that it is desirable and that it would be the wish of the House that when important statements on policy are made they should be made in both Houses.

Your Lordships will recall that a few weeks ago Her Majesty's Government, together with the Governments of the United States, France and Norway, made certain proposals designed to lead to an interim agreement for the use of the Canal, which would, at the same time, safeguard the interests of users for the future. Shortly afterwards, the Egyptian Government put forward counterproposals. These were made informally to certain Governments, including that of the United States.

Since it seemed that these proposals were not in a final form, the Government of the United States undertook a detailed negotiation in an effort to secure improvements before the proposals were formally communicated to all the Governments of the user countries. As a result, certain modifications were secured, particularly with regard to arbitration procedures. On April 24, the Egyptian Government published, as a unilateral declaration, the terms on which it proposed that the Suez Canal would be open to shipping. This position was reported to the Security Council, which was, of course, as it still is, seized of this whole problem. Although the improvements were acknowledged, objection was still strongly taken to the unilateral character of the Egyptian declaration.

The next step was to ascertain the views of the member Governments of the Suez Canal Users' Association. The Council of the Association met on April 30 and has since held a series of discussions which ended in the issue of a statement last Thursday. It was the virtually unanimous view of the Suez Canal Users' Association that the unilateral Egyptian declaration was insufficient and fell short of the six requirements for a settlement of the question which were embodied in the resolution of the Security Council of October 13, 1956. The member States have reserved all their rights with respect to the operation of the Canal and do not accept the Egyptian declaration as a permanent and satisfactory settlement of the question. We share this view to the full.

Meanwhile, your Lordships will wish to know the latest position with regard to the actual use of the Canal by the shipping of the user countries. The great majority of the foreign lines in the shipping conferences serving the principal trades east of Suez have indicated that they will henceforth route their ships through the Canal, as many of them have already done. The shipowners' associations in West Germany and the Scandinavian countries have officially informed their members that the Suez Canal Users' Association statement should be interpreted as meaning that every country and every shipowner is now free to use the Canal at their own discretion.

In these circumstances, and with the reservation of their rights which, as I have already said, has been stated on behalf of the member countries of the Suez Canal Users' Association, Her Majesty's Government can no longer advise British shipowners to refrain from using the Canal. Payments made in connection with the Canal—for Canal dues and other purposes, such as port dues, or water—will be made in sterling.

Your Lordships will wish me to give an outline of the financial arrangements. A new Transferable Account, to be known as the No. 1 (Special) Account, has been opened by the Bank of England in the name of the National Bank of Egypt. So far as payments by residents of the United Kingdom are concerned, this account can at present be used only for Canal dues and other shipping disbursements. Since, of course, non-resident holders of transferable sterling will be able to make payments to the account in the normal way for current transactions, Her Majesty's Government will examine the possibility of extending its use to British residents also for such transactions.

Her Majesty's Government will not interfere with the free disposal of the No. 1 (Special) Account. The existing No. 1 Account, of course, remains blocked. Removal or modification of the existing restrictions must naturally depend upon satisfactory arrangements covering all financial claims against Egypt. Discussions will be held on this basis in a neutral centre. In addition, it will be possible to consider favourably allowing payments to be made by Egyptian traders from the existing No. 1 Account in respect of certain contracts entered into before July 28, 1956. One result of this would be to enable British exporters who had entered into these contracts in good faith and have been prevented by our own restrictions from receiving payment to recover their debts.

The necessary Statutory Instrument to enable the new Account to be opened has been made, and has been laid before both Houses.

2.46 p.m.


My Lords, we are obliged to the noble Earl the Leader of the House for his courtesy in giving here to-day the statement which was made by the Prime Minister in another place yesterday. It is not surprising, perhaps, that the great majority of the Press this morning described the position as humiliating. That does not give any joy or satisfaction to anybody in this country. The end of what the Prime Minister called this stage of the situation is as deplorable for the country as was the adventure from which it arises. We are now, I think, bound to do what we can to keep the Government up to the mark in the further steps which apparently the Prime Minister and the Government hope to take to achieve some improvement in the terms at present made public. It seems to us that the terms at present made public are certainly not better, and probably are worse, than the terms which could have been obtained in October, 1956.

There are certain omissions from the Prime Minister's statement to which attention was called in another place yesterday, and perhaps the noble Earl the Leader of the House may have had an opportunity of consultation since the statement was made and will be able to let your Lordships know what is in the Government's mind: for example, as to what is to be done about the six points which were agreed to by the Security Council many months ago. What steps are the Government taking actively now to see that those very important points, dealing not only with our situation but also with the general rights of all the users of the Canal, are safeguarded? And what is the present attitude of the Government towards the question of the free passage through the Canal of ships of all nations, including, especially, the shipping of Israel?

There is the matter of compensation for the gross breaches made by Nasser in his method of taking over the Canal last July and, therefore, the considerable claim for compensation that arises in that connection. On that, and certain other cognate matters—I do not wish to delay your Lordships too long—I would ask whether it is the intention of the Government to make some appeal to the International Court and have these subjects thoroughly threshed out. I feel that the people in the country, as well as the Members of the two Houses of Parliament, are entitled to immediate guidance by the Government on what steps are being taken in these directions. I hope perhaps that the noble Earl the Leader of the House may be able to give some indication as to what progress is intended to be made in that direction.


My Lords, I am obliged to the noble Viscount for the questions that he has put to me. I do not wish to turn this occasion into a debate—that would be wrong. He will not expect me to accept his interpretation of events; indeed, I would say that there is no evidence whatever, looking back over events, that we should have obtained better terms in October last than we are able to get now. The noble Viscount asked me about the Six Principles. We have always made it perfectly clear that we think that a settlement of this problem should be within the Six Principles laid down by the Security Council. As I said in the original statement, this matter is still before the Security Council, and we will pursue by every means in our power the objective of getting Egypt to agree to a permanent agreement within the Six Principles.

So far as free passage of ships through the Canal is concerned, we have always held that under the 1888 Convention there was freedom for all shipping of all nations, including Israel, through the Suez Canal. So far as compensation is concerned, I have indicated that talks are to be opened with Egypt, and all these economic questions including the question of compensation, will be considered then.


My Lords, may I ask Her Majesty's Government whether they are able to make any statement with regard to the implications of all this matter so far as it affects rationing of motor fuel in this country?


My Lords, I was not in my place at the beginning of Business, but I understand that my noble friend Lord Mills indicated that he was going to make a statement at about half-past three. Perhaps my noble friend Lord Howe will possess himself in patience for another fifty minutes.


My Lords, I should like to thank the Leader of the House most warmly for repeating here the statement which was made by the Prime Minister in another place yesterday. This was far too important a subject, I think, for a statement not to have been made to your Lordships. For many of us, of course, the gist of the statement must have been received with a feeling of very deep regret. It goes far too near complete capitulation to Colonel Nasser than many of us would have felt palatable—I was almost going to say endurable.

The Leader of the Opposition, in the remarks he has just made, asked a number of questions. I quite expected that one of those questions would be: is there to be a debate on the subject? He did not ask for a debate—I do not know why. Possibly he thought that his own Party had not a completely clear conscience on this particular question. But, at any rate, I should have thought it very desirable to have a debate, not merely because questions of this moment should be discussed in Parliament but also because there are, no doubt, numbers of questions about the future which all of us, in every part of the House, would wish to ask. The noble Viscount himself has asked some of them to-day. I really rise to ask the Leader of the House whether the Government would be disposed to give time for a debate on this subject. If so, I should be happy to put down a Motion which could be discussed, and possibly all these matters could be properly explored.


My Lords, perhaps I ought to intervene to say that it is by no means without precedent that the Opposition in this place, to whichever Party they belong, often withhold a decision about a debate until a full-dress debate on the matter has taken place in another place. I do not think that that is an unexceptional rule. But the attitude of our Party and our views upon this matter are fully explained by the Motion of censure which is already down for discussion in another place.


I do not know that I find the noble Viscount's explanation quite convincing. Like the noble Marquess, I was a little curious to know why the Opposition had not on this occasion asked for a debate. On the whole, I think that this matter probably should be debated by your Lordships, if that is the general wish of the House, I think there will be quite a lot to say under a number of headings. As the Prime Minister said in another place, this is really one chapter of a pretty long story; but it is the end of one chapter, and it would be appropriate that we should debate this matter before we began another. If the noble Marquess will put down a Motion, although we are very tight for time, I will try to find time.


My Lords, there is one question which stands out and does not concern the broader issues that have been raised by the noble Marquess, and that is the question of the Israeli ships. It would appear to most people in the world that for eight years the Egyptian Government have been in breach of the Treaty of 1888, yet no-one appears to have done anything effective or taken any steps to put that to rights. I was reading the whole of the debate elsewhere yesterday and I was amazed that so little had been made of that point.

I should like to ask the noble Earl who leads the House: has this matter been discussed in the Canal Users' Association? Are we in favour that Israel should be made a member of the Canal Users' Association? Are we prepared to ask Colonel Nasser under what section of the Convention of 1888 he is acting in excluding the Israeli ships? This is a specific matter which does not raise Party issues as all. It is a matter of straightforward dealing, and it concerns an organised and international effort to extinguish a State which was established by the United Nations. I was going to say that I think it is a pity that we should have been congratulating King Hussein at about the moment when he was announcing that he was campaigning for the life of the neighbouring State of Israel. I leave that—that is a matter of passion; this is a matter of straightforward dealing.

Under the Convention of 1888, provision is made for the meeting of what are called "agents" to examine breaches of the Convention. I imagine that those agents are now represented by the Canal Users' Association—I do not know. I would therefore ask the Leader of the House specifically what is his opinion about membership of the Canal Users' Association by the State of Israel and their right to raise this question in that assembly.


My Lords, I should like to support the request which the noble Viscount has just made for a discussion on, among other matters, this question of the rights of Israeli ships to pass through the Canal, a discussion which, as he said, is many years overdue. But is there not another question closely related to that which ought also to be discussed—I refer to the right of Egypt (a right which I could never agree to recognise) to declare that she is in a state of war against another member of the United Nations? Are the Government going to allow the United Nations to stand meekly aside while Egypt declares that she is at war with another member of the Organisation?—I am told I should have said, more accurately, in a state of belligerency?


My Lords, as I said earlier, the view of Her Majesty's Government on this matter has been made clear—namely, that, like many noble Lords, we have always felt that Israel had a right to send ships through the Canal, as indeed any other country has, under the 1888 Convention. I should like to see on the Paper the question which the noble Viscount has asked me about the membership of the S.C.U.A. I would say this, however. First, it is for Israel to decide how she proposes to tackle this question of the right of Israeli ships to go through the Suez Canal. Secondly, I should have thought it was a question for the United Nations to grapple with and to settle.


My Lords, these are answers which have been given from time to time before. They have led to no action at all. I would venture to point out to the noble Earl that if Egypt has the right unilaterally to declare that she is in a state of belligerency with this or with any other country, and therefore to exclude her ships from the Canal, it means that she has torn up all the guarantees that the Convention of 1888 is supposed to provide.


My Lords, before the noble Earl replies, may I also ask whether this latest announcement on the part of Her Majesty's Government gets us any further forward with another question which is of great interest in your Lordships' debates: that is, the question of the refugees from Egypt, who have been six months without any compensation. Surely something should be done for them.


My Lords, as my noble friend knows, we are at the present moment compiling the claims. We shall shortly have reached a point, in about ten days, I think, when the claims will be in. The situation has been slightly altered by what the Prime Minister said yesterday, in that discussions will be opened with the Egyptian Government on all these economic questions, including, of course, the question of compensation for the many refugees who had property in Egypt. All these questions seem to me only to underline what the noble Marquess has said, that it would be as well if we debated these points. So perhaps we might return to these problems in debate.


My Lords, I have one pertinent question to ask at this moment. Will the noble Earl say whether the Canal Users' Association is still in being, and also whether its members are going to work collectively to get an arrangement or an agreement in harmony with the Six Principles of October 13? Otherwise, we are leaving the Canal in the unfettered control of a single nation. As my noble friend has just remarked, although the Egyptian Government say that they intend to abide by the Suez Canal Convention of 1888, they have already broken it in two respects: for eight years they have denied the right of Israel to use the Canal, and then, during the recent troubles, they blocked the Canal, although they are specifically prohibited from doing that, either in peace or in war.


Yes. It is because the unilateral declaration by Egypt was unsatisfactory in these respects that we were unable to regard it as a satisfactory basis for a permanent agreement. I understand that the members of S.C.U.A. are agreed that it would be a good thing to keep themselves in being and available to act as a collective body representing the users. So far as the Six Principles are concerned, they were laid down by the Security Council, and the Security Council is at present seized of them. They are on the Security Council agenda. Therefore, it is through the Security Council, I think, that we should endeavour, in every possible way, to secure the Six Principles, so that a unilateral declaration may be turned into a permanent agreement.


Are the Government in favour of Israeli membership of S.C.U.A., and, if so, will they take some steps to secure it?


I do not think that I can answer a question on behalf of the Israeli Government. I do not know what the view of the Israeli Government is, and therefore I asked the noble Viscount whether he would put that particular Question on the Paper.


I was not speaking about the Israeli Government. I asked the Leader of the House what was the view of Her Majesty's Government: are they in favour of Israel being a member of S.C.U.A.?


I asked the noble Viscount to put that Question on the Paper, and I hope he will do so; then I will give him an Answer.


May I ask the noble Earl whether the Government refuse to recognise any claims by the Egyptian Government, in the Suez Canal or in the Gulf of Akaba, or elsewhere, which are based upon the alleged existence of a state of belligerency between the Egyptian Government and Israel?


That is a matter of International Law and a matter eventually, I suppose, for interpretation by the International Court. But it has always been the opinion of Her Majesty's Government that Egypt does not have the right to claim this state of belligerency and to act under it.