THE ANGLO-EGYPTIAN AGREEMENT

HL Deb 20 December 1961 vol 236 cc762-800

4.13 p.m.

THE MARQUESS OF SALISBURY

rose to call attention to the situation of the various categories of British claimants under the Anglo-Egyptian Agreement of February, 1959, in the light of the Order in Council laid before Parliament on Monday, December 4, 1961; and to move for Papers. The noble Marquess said: My Lords, in rising to move the Motion standing in my name, I should like to say how sorry I am to have had to raise this important subject in the last flicker of Parliamentary life before Christmas. It is not really my fault. We were, we understood, promised a Ministerial statement on this subject as far back as last July, but we were asked to allow it to be postponed until after the Summer Recess. Reluctantly we agreed to postpone a debate to suit the Government's convenience. However, when Parliament reassembled, after another long delay it was not until November 27 that the Order in Council was issued on the subject to which my Motion relates. We asked, immediately after November 27, for a date for a debate, but at that time there was no opportunity, and eventually the earliest day we could get was the day before yesterday. Even then, as your Lordships know, that day was filched from us for a Foreign Affairs debate. I do not complain of that. It was a very important debate indeed. I am only explaining why it is we have been unable to deal with the question until to-day. I can only say how very sorry I am for this delay, both because of the steadily deteriorating position of the claimants themselves, and also because I believe the subject is too important to be dealt with at the last moment in this manner.

As your Lordships know, five years have now passed since the Anglo-French landings in Suez. They have already become almost part of history. It is not my purpose this afternoon to argue the rights and wrongs of the policy adopted by the Conservative Government of that day, of which I was a member. That would be merely, I think, to cloud the more limited issues with which your Lordships are concerned this afternoon. But there are, I believe, two things we ought to remember. First of all, one of the main purposes of policy in Egypt in 1956, as the then Prime Minister, now Lord Avon, made clear at the time, was to protect British property there. Secondly, whether those landings were right or wrong, one result, at any rate, is certain: that there have been numbers of British firms and British nationals who have suffered very seriously as a result. In particular, I refer to the nationals, the individuals, who were driven from their country, the country where they had made their homes, and their property was either Egyptianised. which means, in other words, nationalised, or sequestrated, and they have been largely ruined.

For some time, as your Lordships know, their outlook was not so bad. They had the most specific guarantees from British Ministers as to their future. The present Chancellor of the Exchequer, when he was Foreign Secretary, gave particularly binding assurances to this effect. He said in another place on May 16, 1957 [OFFICIAL REPORT, Commons, Vol. 570, col. 584]: The blocked accounts"— that is, the Egyptian sterling accounts in London— are our security for the claims of British subjects against the Egyptian Government. We have no intention of whittling away that position. I am sure, knowing my right honourable friend, that he meant exactly what he said. But the pressure of events—and possibly also the pressure of the Treasury—seem to have forced his hand, and when ultimately two years ago it seemed necessary to Her Majesty's Government to seek better relations with the Egyptian Government, an Agreement, as we all know, was negotiated on which the claimants, I understand, were never consulted at all, and which gave away the main bargaining counter on which our rather unhappy fellow countrymen had relied, in the shape of these Egyptian sterling balances which amounted to £41 million and which were held in this country.

Since then the claimants, our British fellow countrymen, have had to be content with the hope that some day, in due course, some portion of the £27½ million, which was all that Her Majesty's Government were able to obtain from the Egyptian Government as a reimbursement on the losses which had been incurred by British nationals owing to the Egyptianisation and sequestration of their properties, to which I have already referred, should come their way. I am not suggesting that Her Majesty's Government have been entirely unmindful of the plight of their fellow citizens. We all know that they set up machinery to enable the claims to be assessed, and they agreed, in addition, to make available ex gratia loans to tide the claimants over the period which must elapse before they could receive the moneys owing to them if their claims were established under the Anglo-Egyptian Agreement. But they were, in any case, bound to lose heavily, for the —27½ million represented only a fraction of the losses that had been incurred by firms and individuals, which amounted to upwards, so I am told, of £100 million.

Moreover, while it was no doubt the intention of the Government to act quite fairly as between the owners of Egyptianised and of sequestrated properties, in fact this did not turn out to be so. The owners of Egyptianised properties, which included actually most of the large firms, have to go through only a comparatively simple procedure. If they merely establish the value of their property at the date it was nationalised, and that that property is gone for good and all, an interim award is paid over immediately; and it is paid over (and this is very important) in London. Owners of sequestrated properties, on the other hand, have had a much rawer deal. They cannot, like the owners of the Egyptianised property, simply regard their former properties in Egypt as gone beyond recall and make a claim on that basis.

The conception under the Agreement, as I understand it, it that they will get their properties back in due course, and when this happens they will be entitled only to put in a claim for the difference between the value at the date of sequestration and the date of the signing of the Anglo-Egyptian Agreement. This is often—indeed, usually—extremely hard to find out, because the first process of the desequestration in itself is extremely long and tortuous. All kinds of difficulties are put in their way by Egyptian officials, and counter-claims are often made in respect of such things as taxation said to be owing by the claimants—claims which may take months, and even years, to sort out.

Even when the desequestration has been completed, there are still many hurdles to be surmounted before the claimants can actually derive any benefit from their property. If it is cash, or stocks and shares, it is paid by the Egyptians into a specially blocked account in one of the banks in Egypt; and there it stays. If it is, say, house property, it is the case that very often after the forced departure of the owner the property has been let to someone else. In order to get possession of it the owner must appear personally and say that he needs the house for his own long-term occupation; and as re-entry permits are usually limited to one year it is not surprising that normally it is impossible to clear out the occupant so as to be able to dispose of the house at its full value. Further, if the property happens to be a business, that business may have been mismanaged during the years of sequestration and may be worth very little when it is returned to the owner. Details of this mismanagement are, however, very hard for him to obtain, and yet such details of the present value of the business are required, I understand, by the Foreign Claims Committee before any claim can be formulated.

My Lords, above all—and this, I think, is the most important thing we have to consider this afternoon—there is the continuing difficulty for claimants in transferring funds from Egypt to England. Even if they have got their property, of whatever kind it may be, desequestrated and converted to some liquid form so that it can be transferred, nowadays, in practice, it is often impossible to get in out of Egypt. Under the Anglo-Egyptian Agreement of 1959, the Egyptians undertook to transfer up to £E5,000, and to give favourable consideration to the transfer of further amounts. But in practice this undertaking has proved to be a dead letter; and the most a claimant can hope to bring to Britain, whatever the value of his estate, is just about £800—that is, the value in sterling of £E1,000. All the rest has to stay in Egypt, and unless the claimant wishes to return there—and, my Lords, after all that has occurred very few wish to do that—it is absolutely useless to him and is likely to remain so for the rest of his life.

This last point of the transfer of funds has become the most urgent problem of all for the claimants at the present time. The situation in Egypt, as your Lordships know, is extremely and, I think, increasingly unstable. There are already cases where property which had been desequestrated has been resequestrated and, taken all in all, the property of claimants in Egypt is definitely not safe there. It is not merely that they cannot get at it; it is worse than that. They may find at any moment, unless they have been able to transfer it to England, that they have seen the last of it altogether. That aspect, which, as I have said, more than any other at the present time causes anxiety to the claimant, is not touched at all by the new Order in Council of November 27.

I fully recognise the effort that has been made by Her Majesty's Government in that Order in Council to increase the grants that can be made out of the £27½ million. In respect of claims that have been established, especially for larger properties, the others had benefited more in the early stages. Though I am quite certain that all those people who have benefited by the new provisions will be duly grateful to the Government for what they have done, this new Order in Council will benefit chiefly the owners of Egyptianised property; and that will make even worse, by comparison, the position of the owners of de-sequestrated property. The more the owners of Egyptianised property get, the less out of the £27½ million will remain for the others. Nor, if I may say so, does the Order do anything to assist what I have described as the most pressing problem of all; how funds which are owed to the claimants in England can be transferred to the United Kingdom.

LORD SILKIN

My Lords, could the noble Marquess give us some approximate idea of the amount of the £27½ million which the Egyptianised property will absorb?

THE MARQUESS OF SALISBURY

My Lords, I think the noble Earl, Lord Dundee, can give more accurate figures than I can, but I believe that if they had the full payment it would absorb the whole of the £27½ million, and a great deal more.

LORD BALFOUR OF INCHRYE

The figure is £60 million.

LORD LLOYD

My Lords, if it will help the noble Marquess I will give the answer. I had a Parliamentary Question about this which dates back, I think, to May 5 last, when the total claims put in on Egyptianised property came to £65,852,000. That figure, of course, represents the claims before they were adjudicated. No doubt the noble Lord will be able to put us further right on that later.

THE MARQUESS OF SALISBURY

My Lords, I am very grateful for that accurate information.

My purpose in tabling the Motion is to ask Her Majesty's Government to look again at these particular aspects. I realise that we have sympathetic Ministers in key posts, both in the Treasury and at the Foreign Office. Cannot they do something to help over this admittedly urgent problem? I say "urgent", not only because of the uncertainty of the situation which to-day exists in Egypt, but because many of those claimants are getting very old. They are retired people; many of them have lost the savings of a lifetime and cannot start afresh. If they are not helped soon it will be too late. I beg the Ministers, therefore, not to weary in well-doing. For, my Lords, welcome though the proposals of the Order in Council are, so far as they go, I must emphasise yet once more that they will not touch at all some of the most basic difficulties of many of the claimants, and especially of those owners whose property has be desequestrated. And, in particular, the Order will do nothing to help them over the problem of how to transfer their money from Egypt to Britain, which, as I have said, is at the present time the worst problem of all.

I very much hope that the noble Earl, Lord Dundee, who I understand is to reply, will be able to give assurances at the end of this debate that the Government really mean to tackle this particular aspect. For instance, I hope he will feel able to say on behalf of the Government that if they cannot get the Egyptian Government to release more sterling for this purpose they will look into the possibility of themselves advancing the money, to be repaid when the money now locked up in Egypt can be transferred to this country. Some arrangement of that kind—I do not want to tie it down too tightly—would be, I think, more helpful than anything, but without that, much of what the Government has said becomes meaningless and may even seem insincere. The money in, say, Alexandria or Cairo, is no use to someone, say, in London, and the Government must know that as well as anyone else. I hope, therefore, that we may receive solid assurances on this point at any rate from the Government to-day.

I am afraid that we may have to decide, in spite of the smallness of the attendance, to divide the House, not, I would emphasise, as an attack on the Government but as an act of justice to the claimants who have, many of them, suffered so much and are still suffering so much for events for which they, at any rate, have been in no way to blame. It is in that spirit that I, and I am sure other noble Lords in this House, will await the reply which the noble Earl, Lord Dundee, is to make. I beg to move for Papers.

Moved, That there be laid before the House Papers relating to the situation of the various categories of British claimants under the Anglo-Egyptian Agreement of February 1959, in the light of the Order in Council laid before Parliament on Monday, the 4th December 1961.—(The Marquess of Salisbury.)

4.31 p.m.

THE EARL OF LUCAN

My Lords, there is no doubt that the House owes a debt of gratitude to the noble Marquess and his friends for raising this matter. The fact that it has been so delayed is a matter for regret. Nevertheless, there are some noble Lords down to speak this afternoon who know the subject so well and who have identified themselves so unmistakably over so long with the interests of these British subjects in Egypt that I have no doubt Her Majesty's Government will be reminded of all the difficulties and of their obligations.

As the noble Marquess said, this is not a time to go back over the Suez incident. It aroused great passions at the time. It has been left in no doubt, I think, where my Party stands on the question. But so far as we in 1961 are concerned, what we have to face is the fact that several thousands of British subjects were, through no fault of their own, owing to the action of the British Government of the day, suddenly, almost overnight, deprived of the greater part of their livelihood and their life savings; that is the thing we must never forget and that is the justification for not letting the Government rest on what they have already done.

I think everyone was glad that relations with the United Arab Republic were restored to normal by the Agreement of February, 1959, but, at the same time, as a settlement it left much to be desired. It is easy to see that Her Majesty's Government were not in a strong bargaining position at that time, and perhaps nothing more could have been obtained, but the fact remains, and it is a fact of simple arithmetic, that the compensation obtained from the Egyptian Government is £27½ million sterling and the value of the assets lost by British subjects far exceeds that. The noble Lord, Lord Lloyd, has reminded us that the claims for Egyptianised property amount to £65 million. The sequestrated property, I believe, has been estimated at £130 million in value.

The noble Marquess said, and I think it is generally agreed, that the Government's proposals in the latest Order in Council so far as the owners of Egyptianised property go are not unreasonable. It is particularly satisfactory that on the smaller estates the Government are giving up to 90 per cent.—that is, up to £5,000. Obviously the small man with the very small property is more in need. The sliding scale goes up to cater for properties of much greater amounts, half a million pounds or over, but it is the owners of sequestrated properties, as the noble Marquess said, who represent the chief problem, and they are the people on whose behalf we ask the Government to think again.

The position is exceedingly complicated. I should be the last to claim full knowledge and understanding of the various categories of the owners of the claims, but other noble Lords who are going to speak, I have no doubt, are perfectly well aware of the problems. Looking at some of the documents, I am struck by certain points on which I would like to know the Government's answer. A proportion of the sequestrated properties, something like two-thirds, have been desequestrated up to date; that was the figure given by the Minister in another place on November 15. We are told that of that figure something like 10 per cent. have been resequestrated in more recent measures of the United Arab Republic Government. Can the Government tell us exactly what is the situation and, under this Egyptian legislation, what are the prospects? Is the resequestration going to continue and going to cover more of the desequestrated properties? What are the prospects? What representations have the Government made to the U.A.R. Government?

The Minister assured an honourable member in another place that the U.A.R. Government are being left in no doubt about the great importance which we attach to remedying the various problems involved. That is all right; they have left the Egyptian Government in no doubt about the great importance that we attach to it. But what then? Do they know what the intentions of the Egyptian Government are, and do they know what the prospects are for the owners of desequestrated property which is again at risk?

Secondly, in March this year Her Majesty's Government said that they acquiesced in representations from the Egyptian Government that their foreign exchange position was so weak that they could not continue to allow owners of property to transfer £E5,000 to the United Kingdom, and Her Majesty's Government agreed to the reduction of that figure to £E1,000, at which possibly it stands now.

What is the Government's view on the prospects of the foreign exchange situation of the Egyptian Government improving to such an extent that our claimants can get more money transferred back to this country? As the noble Marquess said, £E1,000 when it has been processed and turned into sterling, comes down, I think, to £840. Lastly, the Minister in another place said of the sequestrated owners, that 205 had actually got their £E1,000 trans- ferred to this country and he said there was about another 800 applications in, as he called it, the pipeline. That makes a thousand. But it has been mentioned in another place that there were 3,000 persons with claims for sequestrated property. What is happening to the other 2,000 who have not yet submitted their claims? It seems to me that only one-third of those entitled to compensation for sequestrated property have in fact submitted their claims.

There is one other category. The noble Marquess's Motion mentions the various categories of British claimants under the Agreement of February, 1959. I see in the Agreement that there is another category that has not been mentioned—I think possibly the noble Viscount, Lord Colville of Culross, may refer to it, as he has spoken on the subject before: it is, persons entitled to Egyptian Government pensions, together with arrears and so on. The situation of the claimants for sequestrated and Egyptianised property deserves all our sympathy, but we must not forget the small group of pensioners of the Egyptian Government. We hope Her Majesty's Government will include that category in the Answer they are going to give to this Motion. We want to hear the Government's reply as soon as possible. We want to hear the statements of other noble Lords. All I would do is to assure Her Majesty's Government that we on this side wholeheartedly support the noble Marquess in his Motion.

4.43 p.m.

LORD KILLEARN

My Lords, I rise warmly to support the Motion of the noble Marquess and everything that he said. He put the case before your Lordships with great force. The House has always been well disposed on this case. It is one of those questions where there can be no doubt whatever about the justice of the claims, and I am sure that we have never had a better exponent of the case than the noble Marquess to-night. He put before your Lordships certain of the issues immediately confronting us, and I repeat, I rise to support his Motion with all the force at my command.

I do not want to hold up the debate because it is late. Somebody has said tonight that the Government have shown good timing in the time they have allowed—I think it was said in relation to the Motion concerning the hop industry. The time is running rather finely for us; it is now quarter to five. I shall be as brief as I can, trying to limit myself in regard to the Motion to the question of the shortfall.

Before I move to that there are two quite small subsidiary points of which I have given the noble Earl prior notice, and with which he will perhaps be able to deal in his reply. The first one is that which interested this House a good deal the other day—namely, the levy of income tax on the interest on this £27½ million held by the Foreign Claims Commission. There is no doubt that on that occasion the House was solidly against this levy, and I know that the Minister without Portfolio, Lord Mills, undertook to put that matter before the Chancellor of the Exchequer. It would be interesting if to-day the noble Earl could include in what he says some information as to how representations made by this House in connection with income tax levied on the interest of that fund have been received.

The second point of which I have already given preliminary notice—in a sense it is a subsidiary point too—concerns these ex-gratia loans. We have heard little about them lately. Your Lordships may remember that there was an ingenious scheme devised whereby, on the grounds of hardship, advances were made of various sums—they were called ex-gratia loans, I think, and the recipients of these loans had to sign receipts. The receipt was very strongly worded. I have not a copy here—I might well have had one. They agreed that, if and when they received a payment from the Egyptian Government, the loan might be called in. I should like to hear from the noble Earl, if he can give it to us in his reply or perhaps later, a statement of how much has been repaid and how much has been called back. May I put it in this way: what was the total of the ex-gratia loans; and how much has been called back on receipt of doles, or whatever you like to call them, from the Egyptian Government? That is the second point I should like to make.

I propose now to turn to my main point, the question of shortfall. It seems to me that that is becoming the fundamental issue of this whole question. In the interval we are having questions of hardship and so on, which ought to be dealt with, but it may be not a bad thing to remind the House of the degree to which the Government are in fact committed on this question of shortfall. I have in my hand seven closely typed pages of assurances in one form or another given by the Government in the two Houses. I do not propose to inflict all of them on your Lordships, but I think I should refresh your Lordships' memories about one or two. The seizure of the property and the expulsion of these people took place in November, 1956. On April 11, 1957, the Prime Minister used these words in another place: It is the policy of Her Majesty's Government to secure from the Egyptian Government restoration of these assets in full, or alternatively, complete compensation. Those words were more than echoed in this House by my noble friend Lord Home on May 2. On May 15, 1957, the Prime Minister said in another place: We fully realise our responsibilities and the urgency of the matter for all those concerned. I do not want to overdo this business of quotation, but there was an assurance given by the then Secretary of State for Foreign Affairs, Mr. Selwyn Lloyd, on May 16, 1957, in these words: The blocked accounts are our security for the claims of British subjects against the Egyptian Government. We have no intention of whittling away that positon. The House can be sure of that". That was a fairly categorical assurance. What happened? At the time that assurance was given I understand that there were standing to the credit of the Egyptian Government in this country, blocked sterling accounts to the amount of £100 million.

Your Lordships may perhaps remember that after the war we agreed to pay Egypt for all the facilities, camps and so on which, under the Treaty of Alliance we had received from Egypt. I had left Egypt at that time, but I thought that we were acting pretty generously, because after all we were paying Egypt for the privilege of saving her national existence. The sum total of that amount was approximately £400 million; it was fairly generous action on our part.

We now come back to the unfortunate affairs of 1956, when the then Secretary of State for Foreign Affairs gave an assurance that the £400 million had dropped to about £100 million, and as your Lordships can see it was a very categorical assurance. I must say, my Lords, that I cannot guarantee the accuracy of these figures, and they are approximate. Then time passed, and for reasons explained and, I think, understood by all of us—though we did not approve of all that was done—the Government felt that it had to come to an agreement with Egypt which they did in February, 1959. Under that agreement—which I think I can say without doubt was disliked in every quarter of this House, though we felt we more or less had to accept it—we accepted £27½ million in "full and complete discharge" of every obligation that Egypt had towards us under this unfortunate affair.

Incidentally, the claimants were never consulted. When we raised that point we were told that it is common form that claimants are not consulted in cases like that, and it is just done. I have in front of me a letter addressed by the claimants to the Treasury representative, pointing out that they hoped, and ardently hoped, that those funds which were still held as security would not be whittled away. That was during the negotiations in Rome—I regret that I do not have my chronology quite right—but, despite that, the agreement of 1959 was signed.

My Lords, if you can carry your minds back to that date you will realise that I am not exaggerating when I say that we allowed that to go through unchallenged. We all heaved a sigh of relief that there was no Division, and there was no Division because of certain assurances which had been given by the Prime Minister about this question of short-fall. This is the assurance that the Prime Minister gave on March 16,1959 [OFFICIAL REPORT, Commons, Vol. 602, col. 150]: While we will not here and now pledge ourselves to make any fixed addition to the total of £27½ million, as has been suggested in the debate, I can say now that the Government will watch how this works out and will play their part in reaching a settlement which will be reasonable and fair, and we do not exclude a further contribution from public funds. I am only stating the fact that it was on the basis of that assurance that certain Members of this House did not oppose the agreement and let it go through. If anybody cares to read the record of the debate, it is very clearly set forth.

That brings me down to the present state of affairs. There were all those assurances in 1959, and there are all these difficulties to which the noble Marquess has called attention. But where is this generous spirit of helping out, and so forth? It is not the fault of the Foreign Claims Commission that the distribution is working out so inequitably, so unfairly. The Commission simply follow instructions and there is a legal Order-in-Council. The trouble lies in the faulty drafting of the 1959 agreement. Obviously, we all make mistakes, but nobody foresaw at that time how inequitably this was going to work out as between these two classes.

I come now to the point made by the noble Marquess about the nationalised and the sequestrated property. A great many of the claimants in respect of property now de-sequestrated have not even gone as far as presenting their claims to the Foreign Claims Commission, because the Foreign Claims Commission will not take their claims until they have gone through the rigmarole of getting certificates from the Egyptian Government, and so on. But they never will get them, and this will go on for ever. Are we for ever to stand by, because we cannot state the final amount of the shortfall? Are we just to stand by and let these people suffer? I put it to your Lordships that it is grossly unfair. I know that until the total loss of nationalised and sequestrated property has been worked out authoritatively—which has been put to me as £100 million—you cannot fix the totality of the shortfall. But you can at least somehow meet the cases of hardship, though I do not quite know how. I strongly support the Motion of the noble Marquess, and I think that something should be done in the interim. After all, the Government have experts who can work out some means of helping these wretched people. Only last night, by pure accident, I was talking to an unfortunate woman who has been a widow for the last few months. She does not have a cent, not a penny of compensation, yet she had landed property alone worth £33,000. She is now trying to eke out a living by running a shop. And is that right? Obviously, it is not right.

I do not want to say any more because other speakers will follow, but I am extremely grateful to your Lordships for the way in which you have dealt with this matter from the very beginning. Your sympathies are not in doubt, and I think I can probably say the same about the Government, but there is a lot of talk and no action. I should like to see more positive action to meet the difficulties of these people. I feel very strongly about this matter and I think it is a question of national honour. These poor, blameless victims were thrown out without a penny being paid to them and with just the clothes they stood up in. It really is terrible, but the delay still goes on over five years after it happened. It happened in November, 1956, very nearly six years ago—and what more can one say?

4.58 p.m.

LORD LLOYD

My Lords, we have had many debates on this subject, and every time we have a debate I always hope, with everybody, that it will be the last one. For the sake of the claimants, every time we have a debate I hope that it will be unnecessary to have another one because Her Majesty's Government will have done something to put things right. But here we are again with another debate, and I will only re-echo my feelings at other debates, which is that I hope that this will be the last one because Her Majesty's Government will, between now and six months hence, take some steps to rectify what I believe to be a great injustice.

My noble friend the Marquess of Salisbury explained to your Lordships the delay over this debate, and it is perhaps unfortunate that it should have been put off to such a late hour on the last day before the Recess. On the other hand, in another sense it comes at a seasonable time because it is just before Christmas. It occurs to me that possibly something like a Christmas spirit may have got into the breast of the noble Earl who is going to reply. It is true, as we look at Goa and Katanga, that peace on earth is not there in the abundance in which we should like to see it, but perhaps that will be made up for this afternoon by a certain amount of good will from the noble Lords on the Front Bench. At any rate we must hope so, and therefore I once again address my pleas to the Government.

I do not wish to detain your Lordships for very long, because I think the case for the claimants was put admirably by my noble friends, and there is not a great deal to add to it. I can only fill in one or two small gaps, perhaps, and ask for a few bits of information. As the noble Marquess said, the 1959 Agreement, from the point of view of the claimants, was really a disastrously bad Agreement. It was bad for the two reasons which have been put forward this afternoon. It was bad because it extracted from Egypt a sum totally inadequate to satisfy all the claims, and it was bad because, whether through inadvertence or for any other reason, it dealt very unfairly as between the two categories of claimants. I should like to touch briefly on those two points.

First of all, as to the inadequacy of the amount extracted from the Egyptian Government, I have not up-to-date information, but earlier in the year I put down some Written Parliamentary Questions to discover what was the total of the claims at that time. I was informed that the Egyptianised claim, which at that time was the largest, amounted, as I mentioned before, to approximately £66 million. Of course, it is perfectly fair to say that £30 million of that is in respect of claims by individuals, companies and associations who held shares in the Egyptian companies concerned. I think it right to say that the Egyptianised claims have been greatly inflated by the fact that there are two or three very large company claims in the total, and the noble Earl will no doubt make that point later on.

It has been suggested in some quarters that, because these claims are so very large, they ought to be treated differently from the others. I should like the noble Earl to tell us what he thinks about that. My own feeling is that it would not really be right or equitable. One of the biggest claims is that of the British and American Tobacco Company. I see that the noble Baroness, Lady Summerskill, is not in her place, but I hasten to declare no interest. I am not a shareholder or an employee of the British and American Tobacco Company. The British and American Tobacco Company certainly has a very large claim, but I went into this matter and I found that a very large majority of their stock is held by people who have £300 worth of stock or less. So there again you are dealing with small shareholders in this country, and I think that they are entitled to be protected in the same way as any other small man.

My Lords, as I say, at that time the Egyptianised claims amounted to £66 million. I should expect that the majority of those claims have probably been filed, because it is much easier for them to file their claims than it is for the sequestrated people. But I should like to ask the noble Earl—and I tried to give him notice of this question—whether he can tell us the up-to-date figure of the claims actually presented by people with Egyptianised property. As to the claims for sequestrated property, the Answer to the Question was given on June 15 last. At that time a much smaller amount had been claimed by the people with sequestrated property, for the reasons given by the noble Marquess and others—that is to say, they had the greatest possible difficulty in getting their property desequestrated and all the formalities sorted out. At that time, the claims amounted to only £3 million. Again I would ask the noble Earl whether he would bring us up-to-date on that figure and tell us the present amount claimed for sequestration, so that I may get an idea of the total amount of the bill.

On the inadequacy of the fund for these people, I should like to say to Her Majesty's Government that in the past it was perfectly reasonable that they should say that they could not give any indication of their future policy on this matter because they had no idea of the total bill. I think that was perfectly fair. But, with the figures I have given to your Lordships this afternoon, which were given by the Government themselves, there can be no shadow of doubt that the fund is totally and utterly inadequate for the claims made upon it. Therefore I think we are entitled to know from Her Majesty's Government, and I think the claimants are entitled to know, what is their future policy on this matter. They have said throughout that they wish to see a fair and equitable settlement. So far as I can see, even on the figures given six months ago, this fund will pay about 7s. in the pound, and I should like to ask the noble Earl whether, in the view of Her Majesty's Government, 7s. in the pound constitutes a fair and equitable settlement. Secondly, if he does not think so, will he tell your Lordships what sort of figure in the pound Her Majesty's Government would consider a fair and equitable settlement?

Finally, though I do not want to press the noble Earl too hard, I think it would be helpful if he could this afternoon give us some indication as to what steps are going to be taken to produce a fair and equitable settlement on those lines. It would be a great help to noble Lords if we could have that, and I think it is now reasonable to ask that of Her Majesty's Government, because it is quite clear that the claims enormously exceed the funds.

I should now like to touch on the disadvantages suffered by those with sequestrated property. Those with Egyptianised property have already been mentioned by the noble Marquess, and I should not wish to traverse that ground again, but there are one or two points of additional difficulty about which I think your Lordships ought to know and which I think are quite unfair. For example, probably most of your Lordships are unaware of the cost involved to these unfortunate people in getting their property desequestrated. They cannot go there themselves—they would have to spend the whole of their lives in Egypt if they did—so they employ an agent. Over eighteen months ago I was told that an agent's fee at that time, if the desequestration did not take too long, was 5 per cent. of the total value involved. About six months ago I was told it had risen to 10 per cent. Therefore, straight away 10 per cent. goes in getting their property desequestrated, and for that they are not allowed to claim a penny from the fund. On top of that, as your Lordships have been told, the Egyptians, in breach of the Agreement, refused to desequestrate properties until various tax claims had been satisfied—some of them claims which were quite unjustified and, very frequently, almost impossible to counter because the papers had been taken by the Egyptians and had been destroyed or lost. All that increases the bill and puts up the cost to these unfortunate people.

Then, again, there is the case of the compensation. These delays all mean that the property remains in the hands of the Egyptian Government much longer than was ever envisaged under the Agreement. During that time it probably suffers additional damage. Yet, my Lords, the claimants of sequestrated property are not allowed to claim for any damage that occurred after February 28, 1959, if my memory serves me aright. That, again, is extremely unjust. Therefore, if you look at the total position as between these two classes, I would say that everything that the noble Marquess and my noble friend Lord Killearn have said is more than justified; and I think the position is very unfair indeed.

Now I should like to come to one last point. It has been pointed out, both by the noble Marquess and by my noble friend. Lord Killearn, that, of course, nobody wished his property to be sequestrated. I have met no claimant yet who would not infinitely have preferred, for obvious reasons, to have had it Egyptianised. It was, of course, entirely fortuitous whether it was Egyptianised or sequestrated. It was your luck; although, if you tended to be a large company, it was more likely to be Egyptianised because there was more loot for the Egyptians in it. If you were a small man, your property probably was not worth Egyptianisina, so it was sequestrated. It therefore happens that it is the small people who are the people who have been hit hardest, and they are the people who are least able to bear it.

As has been pointed out, it is quite useless to these wretched people to have property in Egypt which they cannot repatriate or do anything about. Furthermore, the Egyptians have made, I would say, very little effort, really, to honour their part of the Agreement. They took the sterling balances, which were the last sanction we had available to put pressure upon them to do anything. Here, may I say, looking back, that I think it was rather imprudent of Her Majesty's Government not to have kept something back in order to see that at any rate the terms of the Agreement were honoured. As it is, we have no means of exerting any pressure at all on the Egyptian Government.

The sum of £5,000 is, I believe, a small amount to be allowed to repatriate. I should like to re-echo here what the noble Marquess said, and I make a slightly different suggestion from the one he made. The Egyptians have spent all their sterling balances—I suspect on Czechoslovakian arms, which they have been importing recently—and have nothing left. Therefore, I think it is a genuine fact that They have no sterling exchange. But in looking at their balance of payments position, it seems to me that they are not likely to have any sterling exchange in the future. They have had a deficit on current account for the last two years, both with the United Kingdom and with the sterling area, so it is clear that these people will not be paid out in sterling unless something is done.

Therefore, I would ask the noble Earl whether some scheme on these lines would not be possible. Her Majesty's Government have various expenses in Egypt, and £5,000 per head is not a large sum. Would it not be possible for somebody who has his property eventually desequestrated, and can sell it in Egypt, and therefore has Egyptian currency, to be given £4,000 sterling, and give Her Majesty's Government the equivalent in Egypt of £4,000 sterling, which could be used by them for British Government expenditure in Egypt? It would enable these people, at any rate, to get their £5,000 promised in the agreement; otherwise, so far as I can see, they will never get it. I do not put that scheme up as anything hard and fast, but merely as a possible means of doing this, because Her Majesty's Government so far as I know, are the only people likely to want Egyptian currency in Egypt at the present time.

I will say nothing more, except to reecho the pleas which have been put to the Government about these people. It is six years now since this happened to them. Whatever the rights and wrongs of the Suez operation, and whatever the rights and wrongs of the agreement—Her Majesty's Government have said it is the best agreement they could get and that may well be true; I do not know—it seems to me that, throughout, these people have been the victims of British national policy at no fault of their own. For that reason alone, they have suffered on behalf of this country, and I think it is up to this country to do something for them in return.

5.12 p.m.

LORD BALFOUR OF INCHRYE

My Lords, this is no new subject, but your Lordships on both sides of the House have been very generous in giving support to the various debates which have taken place. if some of your Lordships are at all weary of repetition, and if Her Majesty's Government are at all weary of debate, that weariness is nothing to the weariness of the claimants. I would, if I may, in a very few moments, summarise one or two points and underline one or two. It seems to me that all the debates, Questions, Government replies and assurances do not alter three facts. The first is that the agreement has not worked out as hoped; secondly, the position remains unsatisfactory; and, thirdly, great sections of claimants remain entirely unsatisfied.

The position of the fund to-day is this. Of the fund of £27½ million, in two and three quarter years approximately one-third has been paid out, almost entirely against Egyptianised claims which will finally amount to some £65 million. There is remaining the great bulk of some £35 million at least of claims for damage to sequestrated property. The contrast in these two classes of claims has been stressed by my noble friend Lord Salisbury, but I have worked out a figure. In the case of Mr. A, who had a claim admitted for £50,000 of nationalised property, under the distribution of the three Orders-in-Council Mr. A will get approximately £30,000 over here. Mr. B, who does not wish to go back to Egypt, has a claim for £50,000 for damage to his sequestrated property, and the most he would get over here at the present time is some £830 sterling. There is only a general indication from Her Majesty's Government of the possibility of future help when the fund is exhausted, as it seems it inevitably will be with the claims of the Egyptianised and sequestrated claimants. Therefore, I think I am justified in saying that great sections of claimants remain unsatisfied, and that the position is unsatisfactory.

I believe that the basic reason for this—and I think it is time it was said—is that Egypt has shown an increasing lack of good will to implement, in spirit and in fact, the agreement. For example, paragraph 4, Annex B, said that all sequestrated property was to be released within three months of application, but nothing of the sort has occurred. There are difficulties put in the way; there are arguments over registration; and there is the refusal to release until tax claims have been paid (which is entirely contrary to the Agreement); and, again, claims cannot be dealt with until certain documents are produced, and these documents are either lost or unobtainable. But I would remind your Lordships of these phrases in the Agreement: "Give immediate approval"; "Ensure within three months"; "Provide copies of all records"; "Give favourable consideration". They have become meaningless words because of Egypt's evasion, in spirit and in fact, of what she had undertaken to do under the 1959 agreement. It is hard to foresee any date of finality of claims for damage through sequestration and of claimants either in having their claims agreed in Egypt, or, unless the Government go further than they have felt able to up to the present in regard to Shortfall, in getting cash here.

In successive debates here and elsewhere we have been told: "Go easy; hold hard in your criticism of Egypt for the sake of the claimants' cases being administered in Egypt", and also on the wider grounds of the restoration of Anglo-Egyptian trade and political relations. We were told of hopes that trade would flow and friendship would flower. In fact, trade with Egypt is such that she cannot meet the exchange obligations under the agreement, and Colonel Nasser's economic conditions are becoming desperate. In fact, so far as friendship is concerned, Colonel Nasser's radio and press continues to pour out constant abuse of the United Kingdom and our policies. My Lords, if my remarks are thought in any way unhelpful, I do not care, because there comes a time when, as someone once said, "enough is enough", and constant turning of the other cheek to insults and obstruction becomes a painful and useless process.

I think the time has come to ask Her Majesty's Government two questions, and I hope the Minister will be able kindly to give a reply to these two questions. Do the Government see any finality in the processes of sequestration claims in Egypt; and, with only guarded statements as regards possible shortfall, do they foresee the sequestration claimants getting back a large proportion of their losses? Or, do the Government take the view that these claimants must be prepared to face great losses not envisaged at the time of the agreement, and which Her Majesty's Government cannot be expected to make good? If the latter is the case, I believe it is kinder and better to say so now, rather than continue shadow boxing as to Egypt's real intentions and Her Majesty's Government's ability to make good. In conclusion, I would summarise the position in three sentences. Here we have an agreement that has not worked. A debt of claims remains unpaid. And, a debt of honour has not been met.

5.20 p.m.

LORD BARNBY

My Lords, I wish at once to associate myself with everything that has been said by the noble Marquess, Lord Salisbury, with such lucidity and conviction. As one who has raised this matter in your Lordships' House before, I might have wished to repeat much of what I have already said, when my feelings were high, but I think that there is no point in prolonging the debate by repetition.

It would seem that we are dealing with matters that are particularly in the hands of Her Majesty's Government. There are questions for reference to the Egyptian Government but, in the main, the force of our representations is that the arrangement has been concluded with the Egyptian Government and therefore it remains for Her Majesty's Government to implement it. My noble friend Lord Killearn has referred in a factual manner to the past assurances given by Her Majesty's Government. I feel that, apart from compassion—and, goodness knows!, we all receive enough letters giving the most poignant instances of the misfortunes that have beset the people who have had their property sequestrated—we have a right to look to the Government to give evidence that they are not shirking their responsibility. I refrain from saying "commitment", because no succeeding Minister can be committed necessarily by his predecessors. My noble friend Lord Killearn quoted the Prime Minister's words: We do not exclude a further contribution from public funds. And in another place as recently as December 5, Mr. Heath, the Lord Privy Seal, stated that [OFFICIAL REPORT, Commons, Vol. 650 (No. 26), col. 1143]: Her Majesty's Government adhere to the statements, but cannot foresee what the total amount will be. Presumably, that is the amount of additional compensation contribution the Government may make.

The noble Earl, Lord Lucan, put forward in a temperate manner the strong views felt on the other side of the House. The noble Lord, Lord Lloyd, has given us, in appealing language, the position of the claimants under sequestration. I am going to refer to a case under Egyptianisation. It is of a company which is based in the City, in which I have a great interest and which I had the honour to represent in Parliament. It is a large concern with 14,000 shareholders and is very much in the position of the company about which the noble Lord, Lord Lloyd, was speaking. The holdings of the shareholders are very small, and therefore it is quite inequitable to suggest that, because this is a large claim from one company, it should be treated differently from the smaller claims, because the effect on the thousands of small shareholders may be just as great.

In the past, this company has shown great courage and spirit of adventure in investing a large amount of money in Egypt, to the advantage of the shareholders and of the Exchequer in this country, and it has experienced a very large loss. The amount of their claim is over £3 million. Under the distributions to date, they have received only 25 per cent. of their claim. Surely it sounds very unfair that 75 per cent. should not be returned to the company. In the first distribution, the amount they received was £97,000; in the second dis- tribution, £256,000, and in the third, which we have recently had, they received the modest sum of only £50,500.

I give this as an illustration of a purely business case. In the cases of sequestration, there is compassion and hardship and sad tales of the effects of the present policy. My purpose is to raise the instance of a large claim which receives such a small amount of compensation. It appears that only about 48 per cent. of the approved Egyptianised claims have been completed. It would look as though in the end not more than 45 per cent, will be available without recourse to public funds. Surely, on those grounds, the earnest pleas that my noble friend Lord Killearn made should carry great weight. The noble Marquess, Lord Salisbury, has also said that there is strong feeling in the country about this matter. It is in that spirit of Christmas anticipation to which my noble friend Lord Lloyd referred that we earnestly hope the noble Earl may be in a position to-day to remove the need for these continued references in Parliament to the dragging of their feet by the Government, and that he will be able to announce something not only on grounds of compassion, but on sheer business grounds; that there should be the honouring of an apparent intention by the Government. If there is not, I feel that I should look forward to following the noble Marquess into the Division Lobby, should he decide to divide the House. However, I hope that will not be necessary and that the noble Earl will be able to give us the reassurance for which we have been so long waiting.

5.31 p.m.

THE EARL OF DUNDEE

My Lords, I should like to begin by saying that I entirely appreciate and sympathise with the difficulties the noble Marquess has had in bringing this subject before your Lordships until now. I know it has been put off on many occasions. I remember that a little before the Summer Recess, when I had a different office from the one I am in now, I was to have had the duty of replying to the Motion which my noble friend had put on the Paper, because none of my colleagues was able to be here on the day for which it had been put down, and although I most diligently prepared myself to undergo a severe inquisition from the noble Marquess, I was considerably relieved when I heard that he had decided that I ought not to be allowed to "hold the baby" and he would prefer to wait until some more experienced nurse should arrive.

May I express my gratitude both to the noble Marquess and to all noble Lords who have spoken to-day, not only for the moderation with which they have expressed themselves but also for their brevity. I do not think, if I may say so, the strength of their case has in any way suffered from it. I realise that the reason for it is that we all want to get our business finished before the Royal Commission. I am grateful for their consideration, and I will certainly do my best to give them all the information that I can give at the present time.

I know that your Lordships are deeply affected by the real hardship which has been and is being suffered by so many British subjects, both men and women, who either temporarily or permanently have lost property and possessions in Egypt. I recognise that it is the hard situation of many of these persons which underlies what has been said by your Lordships this afternoon. The Motion of the noble Marquess calls attention to the various categories of claimants, but in reply to it I think I should prefer to distinguish not between the various categories of claimants, but between different categories of hardship, because one claimant may suffer in two or three quite different respects, some of which are covered by the 1959 Agreement, while others are not.

There are, as I see it, several different categories of hardship. There are, first, those whose property was Egyptianised permanently in 1957. Next, there are those whose property was sequestrated and restored having suffered damage. Both these categories of hardship are covered not only by the Agreement of 1959 but specifically by the £27½ million which was then transferred to us for the purpose of compensation by the Egyptian Government. Thirdly, there are the people (who, of course, may in some cases be the same) who have received back their property; who may or may not have a claim for damage, but who, whether they have a claim for damage or not, have great difficulty in getting any value out of their property—either in getting any of the income from it or, if they find it necessary to sell it, getting any of the capital. These are also covered by the 1959 Agreement to the extent of £E5,000. They are not covered by the £27½ million which was transferred to us for the purpose of compensation, but under the Agreement the Egyptian Government undertakes to pay them up to £E5,000 in respect of the value of their property, quite apart from whether they can get any other value out of it or not.

The next class of grievance is that of those people whose property has been sequestrated and restored, but who, even if they do get the £E5,000 which is provided for under the 1959 Agreement, may have a lot more property in excess of £E5,000 from which they are unable to get any benefit, because they are not living in Egypt and because of exchange difficulties. They are not covered by any agreement at all. All the benefit to which they are entitled under the 1959 Agreement is, first, compensation for damage inflicted while the property was sequestrated (that may come out of the £27½ million); and secondly, the £E5,000 which the Egyptian Government undertook to make available. Apart from that, they may have no claim for damage, and the £E5,000 may be a very small fraction of the value of their property. Over and above that, they do not come under the 1959 Agreement, and, naturally, they may suffer hardship through owning property in Egypt out of which they cannot get any benefit owing to ordinary exchange difficulties.

Finally, there is the question of resequestration; that is to say, in the last few months in some cases the Egyptian Government has again sequestrated property which may or may not have been sequestrated before. That presents us with an entirely new set of difficulties. With your Lordships' permission, I should like to say a word about all these different categories of hardship.

THE EARL OF LUCAN

My Lords, before the noble Earl does that, could he clarify one point He said that the Egyptian Government would make available £E5,000.

THE EARL OF DUNDEE

Under the Agreement.

THE EARL OF LUCAN

That is the claimant's own money, not a grant from the Government. They are going to give exchange control permission to export that money.

THE EARL OF DUNDEE

I said that it did not come under the £27½ million, which is their own money which they gave for the purpose of compensation. That is a question of releasing currency.

THE EARL OF LUCAN

Releasing the individual's money.

THE EARL OF DUNDEE

Yes, of course. It does not come under the £27½ million given for the purpose of compensation. It was an undertaking that they would release up to £5,000—that they would release £5,000 of the property of the owner whose property had been sequestrated and restored.

LORD LLOYD

My Lords, before the noble Earl goes on, for the purposes of clarification may I make one point? When he said that things are covered by the Agreement, I take it he means that they fall within the ambit of the Agreement. He does not mean that the fund has enough money to cover the losses, because there is not enough money to cover them.

THE EARL OF DUNDEE

I did not mean to imply that £27½ million was enough to satisfy all the claims—certainly not.

Now let me say a word about the first category—that is, the former owners of Egyptianised property whose payments have been revised under the recent Order in Council. The scope of this Order (in regard to which my noble friend Lord Killearn asked me a question a week or two ago, and to which I think a fairly full answer was given) is a limited one. It does not widen or narrow the categories of claims on which compensation can be paid, and it does not relate to people who have suffered losses which are later than, or not covered by, the financial Agreement of 1959. The purpose of the new Order was to allow the money still available in the Foreign Compensation Fund to be distributed as soon as possible, particularly to those who are most in need of it—namely, the many individual claimants for smaller sums, many of whom have been suffering very severe hardship. Its purpose was thus to provide additional relief for the more needy claimants, whose cause has often been pleaded so eloquently by my noble friend Lord Killearn and others.

I am sure your Lordships will not wish to go again over the various percentages which have already been fully gone into. As I explained to your Lordships, the result will be that all the smaller claimants will now receive about 90 per cent. of their assessed claims. I pointed out to your Lordships that we appreciate that a large claimant (whose case has been mentioned, very rightly. this afternoon by both my noble friend Lord Lloyd and my noble friend Lord Barnby) may be a limited liability company with many small shareholders.

LORD KILLEARN

My Lords, I do not like to interrupt the noble Earl, but he was talking about the small claimants being satisfied as to 90 per cent. Can he tell us how much they have had to hand back in payment of loans?

THE EARL OF DUNDEE

As my noble friend asked a question on that, I have got an answer, and perhaps I might give it now.

LORD KILLEARN

It seemed to fit in there.

THE EARL OF DUNDEE

My noble friend particularly asked how much had been given in ex gratia loans, and how much had been called back and paid. The amount so far repaid is negligible—practically nothing. The amount issued, I am informed—I have only just got this—is £700,000.

LORD KILLEARN

Do I understand that the amount repaid is negligible?

THE EARL OF DUNDEE

Paid back, yes.

LORD KILLEARN

Is that really so?

THE EARL OF DUNDEE

That is my information, but I will certainly confirm it.

LORD KILLEARN

With all respect, I wonder if it is correct.

THE EARL OF DUNDEE

If it is not, I will certainly inform my noble friend.

LORD BARNBY

My Lords, could the noble Earl at this point in the sequence of his speech say what is the percentage of the distribution to date on the sequestrated claims?

THE EARL OF DUNDEE

I do not think it will be necessary for me to give that in the form of percentages. In a moment I was going to give the actual figures, particularly in reply to some detailed questions which were asked by my noble friend Lord Lloyd.

LORD SILKIN

My Lords, the noble Earl is trying to explain a very complicated question which some of us here are trying to follow. I think it would be in the interests of the House if he were allowed to make his statement. The noble Earl does not need me to champion him, but I am trying to understand, and all these questions seem to me to confuse the issue.

THE EARL OF DUNDEE

I will do my best to speak, either without or with interruptions, as your Lordships please. I hope we shall be able to conclude before the Royal Commission. Until then I am very much at your Lordships service in this matter, because I know it is a complicated question, and I think your Lordships are entitled to all the information you want and I am in a position to give.

In respect of the larger claimants under this new Order in Council, I want to say that they will receive about 25 per cent. of their total claims, if they are over £500,000. Although the percentage above £500,000 is not increased, they get the increased percentages up to £500,000 which applies to everybody; and that, in the case of a firm which has more than £500,000, would amount to £50,500. This new Order of course does not represent a final distribution. It provides only for what we think can safely be paid out now, keeping a reasonable amount for the claims which have not yet been formulated.

I should like, before I go any further, to try to give the information which my noble friend Lord Lloyd asked for, first, about the amount of Egyptianised claims, and then the amount of the claims for damage on sequestrated property, on which I can give some more up to date figures than I gave last time in respect of claims presented to the Commission up to November 30. The claims for compensation for Egyptianised property amount to £59,489,406. We must divide that into two classes, the claims which have been assessed, and those which have been made but not assessed. The figure of £38,980,138 represents the total assessments made and approved by that date—that is, November 30—including both large and small. Then the balance of £20,509,268 represents the claimants' figures of amounts of claims for which no assessments had been made by November 30.

Now the claims for sequestration losses, as your Lordships will appreciate, of course, take very much longer. It takes people much longer to find out how much damage they think they are entitled to claim for than it takes them to find out the value of property which was confiscated in 1957. The information about these claims for damage is often difficult to get. But the total claims for sequestration losses presented by November 30 amounted to £4,043,234, of which a good deal less than half, namely, £1,613,869 represents assessments made, and the balance of £2,429,365 represents the amount of claims still to be considered and assessed. When we add these figures together we find that the total known commitment on November 30 was £63,532,640, which is not very much less than the conjecture of £65 million which was made in another place on November 16 by my honourable friend the Parliamentary Under-Secretary, Mr. Thomas.

There are just two further facts regarding the work of the F.C.C. that I should like to put before your Lordships. The first is that since the new Order in Council came into force on December 5, up to December 18, the Commission have sent out a further 503 cheques for a total of £474,378. Next, we are trying to speed up the work of the Commission in dealing with all these claims, which have taken so long to formulate; and in order to hasten matters further two Commissioners have been appointed so that from the beginning of this month six Commissioners have been at work instead of four.

As my noble friend Lord Killearn suspected, the information which I had got was not complete, but I now have it complete, if I may go back to that question of ex gratia loans. The total amount issued was £7½ million, and the amount repaid directly by recipients is negligible. That repaid by deduction from Foreign Compensation Commission payments is £700,000 out of £7½ million. I am sorry that the first paper I got, which had to be done in a hurry, was not complete and not at all clear in that respect. I am very glad now to be able to give my noble friend the figures which I know he wanted to get.

LORD KILLEARN

I thank the noble Earl very much.

THE EARL OF DUNDEE

I have spoken about the owners of Egyptianised property and the people who have claimed for damage for sequestrated property which has been restored to them. After that, we come to the next category of British owners of de-sequestrated property, that is to say, those who are entitled under Article V (1) (a) of the Financial Agreement to receive a transfer of up to £E5,000 of their released property into sterling. The noble Earl, Lord Lucan, said in his speech that this had been reduced to £E1,000. It is not quite correct to say "had been reduced." Owing (as I think most of your Lordships who have studied the matter recognise) to genuine currency difficulties, it has not been possible to make the payments provided for so far under the Agreement, and last March, as a temporary measure, and for the time being only, we got the Egyptians to agree that they should grant permission for immediate transfer of up to the first £E1,000 of each application which was found to be in order. That is the basis for the figure of £840. which represents £E1,000, which is all that these people have so far been able to get. In the great majority of applications which have been notified to us as being in order—the number is about 240—this permission has been granted.

Her Majesty's Government are constantly pressing the Egyptians to give full effect to the provision of the agreement by which the full amount of £E5,000 should be authorised, but so far without success. My noble friend Lord Balfour of Inchrye asked me to say whether we really thought that they would be able to pay. I know his motive was to try to let people know the worst now, as I think he put it. It is a very difficult thing to prophesy whether the future course of international trade will or will not allow another country to have a larger foreign exchange balance than it has now. And would it do any good if one took a pessimistic line and said that, according to the way things seem to be going now, there does not seem to be much chance of it? I do not think it would be desirable for me to take that line. It is not at all impossible that the trade of any country should improve its balance with the result that that country might hold a greater quantity of any particular kind of foreign currency; and I do not think we should take such a necessarily despairing view of the future of world trade that we think a country which is now in exchange difficulties should not be able in future to extricate itself from these difficulties.

As for the question of Egyptian will to do so, I shall say something about that at the end of my remarks when I deal with the question of re-sequestration; but my noble friend will understand that we want to give every chance of goodwill operating or reviving and you do not always achieve that object by losing your temper early in the negotiations because you are irritated by delays, some of which seem to be deliberate and many of which seem to be unnecessary. I am sure your Lordships will understand that if I want to do the best I can for the claimants I ought to be as careful as I can in what I say on that subject in reply to my noble friend's question.

Her Majesty's Government are constantly pressing the Egyptians to give full effect to the provisions of the agreement by which the full amount of £E5,000 should be authorised, but, as your Lordships know, so far only with the meagre success of getting the first £E1,000 released. We are of course actively considering whether any means can be devised, without relieving the United Arab Republic of their obligations in this matter, to help those people who have not been able to obtain their full rights under this particular revision of the agreement, because their difficulties are very keenly appreciated.

I am not sure whether the noble Marquess was referring to people who had claimed £5,000 or to the people who had a great deal more than £5,000, but it does not really matter; he said, if they cannot get sterling, will the Government advance money against the future possibility? We are considering many possible lines of action in that direction. I will certainly put the noble Marquess's views before my right honourable friend and the Treasury. My noble friend, Lord Lloyd, had a suggestion that we might transfer sterling to people here and get it back from them with our expenses in Egypt. I will certainly look into that and I am grateful to him for making the suggestion.

It is, of course, more urgent in the case of the people who have not got their £5,000 sterling which was promised under the 1959 Agreement, but it applies also, as your Lordships recognise, to people who had more than £5,000 and who, even if they got their full amount of sterling payable under the 1959 Agreement, would still have a lot more property left which might be of very little use to them. There is no provision under the Financial Agreement by which those people can transfer more than £5,000 of their property from Egypt to here, and they may therefore be worse off even than the people who can claim against the Compensation Fund. That is a difficulty which does not apply by any means only to Egypt. There are very many countries in the world who, for various reasons, have nationalised or seized or taken property, sometimes with compensation and sometimes without compensation, sometimes with compensation which is extremely inadequate; and some of your Lordships may well think that this would have happened in Egypt even if the events of 1956 had not occurred and even if the Financial Agreement had not been concluded.

The question of what can be done to help people with more than £5,000 of Egyptian property does not arise out of the Financial Agreement, but we have had their case very much in mind, and during the past year or so we have been actively exploring a number of suggestions for trying to help them by some kind of arrangement by which their blocked assets in Egypt could be utilised against the provision of sterling in this country. I am bound to tell your Lordships the difficulties have been rather greater than we thought they would be at first, and so far I am not in a position to say that any practical solution has been found, but we are very anxious indeed to find one.

The whole position on this question, which has been giving us all so much anxiety for the last four years, has been sharpened in the last few months by the decision of the Egyptian Government to resequestrate a considerable amount of property owned by foreigners in Egypt. It began in the third week of October. So far a total of about 850 people are involved, of whom 47 are British subjects. So your Lordships will see it is not a measure directed against British subjects in any particular sense; it is a general policy of taking over the property of foreigners. It has affected 850 people, of whom 47 are British; and of those 47, 11 are living in Egypt, the remainder are not. It is impossible to assess with any degree of accuracy the value of all these assets belonging to British subjects affected by these new measures; any estimate must largely be guesswork, since it can be based only on unverified figures which were given a long time ago in our case. As I said, most of the 47–36 out of 47 of the British subjects—are living outside Egypt. They have been unable to regain personal possession of their property in Egypt since 1956, either because it has not been returned to them at all under the 1959 Anglo-Egyptian Financial Agreement or because they have not been allowed to bring assets out of the United Arab Republic, except for very small quantities in a few cases; and therefore these latest measures mean that a number of British subjects have had their property sequestrated a second time.

With regard to those who are living in Egypt, I understand that the Egyptian Government are making arrangements for the payment of monthly allowances to them, but only after an examination of each individual's assets and liabilities, which takes time. The Egyptian bureaucracy is even slower than those with which we are more familiar. One British subject is known to have applied for such an allowance, and Her Majesty's Embassy in Cairo have spoken to the United Arab Republic authorities about her case. But so far the Embassy have not reported receiving any request from the British subjects concerned for financial assistance as a. result of the measures in question.

On October 29, a fortnight after these measures were announced, our Ambassador in Cairo asked the Egyptian authorities to explain the grounds on which these measures had been taken against British subjects. On November 13 he raised the matter again with the Egyptian Foreign Minister and left an aide armoire setting out more fully the information which we required and which we think we ought to be given. Since then we have received an unofficial translation of the Proclamation under which these measures have been published. It is dear, as I said, that they are not directed against British property as such, but their effect seems to be equivalent to the sequestration measures which were imposed in 1956, and there are several important questions which will require clarification. Accordingly, my noble friend, the Foreign Secretary, raised this matter on December 7 with the United Arab Republic Ambassador in London. He pointed out that Her Majesty's Government still awaited from the Egyptian authorities an official statement for the reasons for the sequestration of British property affected; that Her Majesty's Government needed to know whether the Egyptian authorities had really taken a temporary measure and would hand the property back or whether they proposed to confiscate some of the property, and if so what rate of compensation they would pay. The answers to those questions are still outstanding. They have not yet been received, and until they are forthcoming the situation is bound to appear unsatisfactory.

As I said earlier to my noble friend, Lord Balfour of Inchrye, I do not want to prejudge it, but Her Majesty's Government have left the Egyptian Government in no doubt of the seriousness with which we view these matters. Unless the position is clarified soon, there is clearly a risk that the welcome improvement in Anglo-Egyptian relations over the past year or two may not be sustained. We should naturally regret such a development, but the remedy, in our view, now lies firmly with the United Arab Republic Government. Meanwhile, I should like to associate myself with the expressions of sympathy from your Lordships for this new class of hardship which has arisen so lately. Although it is difficult, in the absence of further information, to decide what further steps might usefully be taken to protect their interests, we are actively considering all possible courses.

My noble friend Lord Salisbury indicated in the course of his remarks that he might possibly wish to divide on this question, or he might possibly wish to withdraw his Motion. I do not know whether it would do more good to withdraw the Motion or to accept it, but if the noble Marquess would prefer it to be accepted I see no objection to advising your Lordships to do so. With regard to the Motion for Papers, your Lordships are fully entitled to all the information you want on the subject, and I see no objection to calling attention to the various categories of claimants. I am not trying in any way to incite the noble Marquess to press his Motion, but I should like to make it plain that I do not see any objection if the noble Marquess thinks it would do more good to the people we are all trying to help, that the House should accept the Motion rather than that he should withdraw it.

LORD BARNBY

My Lords, before the noble Earl sits down, is he able to say how soon another substantial distribution is to be made, even if it involves, as has been suggested, a contribution from public funds?

THE EARL OF DUNDEE

My Lords, we have just made a new distribution under the new Order. With regard to the question of public funds, I could not go beyond the statement of the Prime Minister, which was quoted in full by my noble friend Lord Killearn and which he made on March 16, 1959. I will not quote it again because my noble friend has quoted it all correctly.

I would conclude by thanking the noble Marquess for giving us an opportunity to debate this question, and I would again say that I will leave it to him whether he thinks it will do more good to withdraw the Motion or to ask your Lordships to accept it.

6.12 p.m.

THE MARQUESS OF SALISBURY

My Lords, I need not say how grateful I am to the noble Earl, Lord Dundee, for the sympathetic and persuasive tone of his reply. I will not go into all the points he has raised, first of all because there is nothing so tiresome at the end of a debate as a mover who makes his speech again, and, secondly, because I understand we have coming a Royal Commission and the Government wish to finish this debate before that. I would only say that he has done his best for the Government in the circumstances, but he has in fact given no absolute assurances on some of the most important points which were raised, and in particular he has given no absolute undertaking that the Government will make it possible for claimants who have assets in blocked accounts in banks in Egypt to transfer them to this country.

I know that my Motion was widely drafted, and in order to crystallise the position I should like to put one simple question. I am not sure whether my noble friend has answered it yet, but anyway I should like him to do so. My question is: will Her Majesty's Government give an undertaking that they will make arrangements by some means or other that will enable claimants with assets in blocked accounts in banks in Egypt to transfer those assets forthwith to this country? If the answer to that question is "Yes", I will withdraw my Motion. If the answer is "No", I must press it to a Division. In saying that, I should like to make it clear that the vote on this question need not, and should not, be regarded as hostile to the Government. It is not intended to be that, because in my view this is a purely non-Party matter. It should be regarded as an expression of the sympathy of the House towards these unhappy people, and support for their claim to justice. I just ask my noble friend, is the answer to that question which I have asked him, "Yes" or "No"?

THE EARL OF DUNDEE

My Lords, the answer is that we could not give an undertaking to do so, but we are trying our best to find out means of doing so. The noble Marquess has put me in a slight difficulty in suggesting that perhaps the whole of his Motion should be dependent on this one point. The only reply I can give is that we are doing our best to find some method of doing this. I do not see how we can give any promise that it will be done.

THE MARQUESS OF SALISBURY

My Lords, I am afraid that I think these claimants will expect an expression of the opinion of this House, and therefore I am afraid I must divide the House.

On Question, Motion for Papers agreed to.