§ LORD FORSTER OF HARRABYMy Lords, I beg leave to ask the Question which stands in my name on the Order Paper.
§ [The Question was as follows:
§ To ask Her Majesty's Government whether the capital gains tax on the increase in the value of assets between 1965 Budget day and the disposal of the assets will apply to dated Government and local authorities' stock.]
§ THE PARLIAMENTARY SECRETARY, BOARD OF TRADE (LORD RHODES)My Lords, I must ask the noble Lord to await the proposals which my right honourable friend, the Chancellor of the Exchequer, will present in due course.
LORD LUCAS ON CHILWORTHMy Lords, does the noble Lord really think that that is a fair answer to give to the millions of small investors who have invested their savings in Government gilt-edged securities, the terms of which may be falsifies by their being redeemed not at par but at par less a capital gains tax, which was never envisaged when they were issued years ago? I would beg the noble Lord to consult his right honourable friend again to see whether the fears which are prevalent can be allayed for the smaller investors. Might I remind the noble Lord——
§ LORD SHEPHERDQuestion!
§ LORD LUCAS OF CHILWORTHWhen I was ask ing the noble Lord whether I might remind him, I thought 670 I was asking a question. That is my interpretation of English. May I remind the noble Lord that at the Guildhall the other day the Prime Minister said that he would do everything to encourage investment but he drew the line at speculation? Would the noble Lord call an investment in 2½ per cent. Savings Bonds 1964–67 at 2½ per cent. a speculative investment? If the Government are going on like this, will the noble Lord take note that football pools coupons and speculations of that kind will have more gilt on their edges than the coupons of Government stocks will have on theirs?
§ LORD RHODESMy Lords, with regard to the first question, I think my Answer was perfectly reasonable. With regard to the second question, I have noted the noble Lord's anxieties and will draw my right honourable friend's attention to them.
§ LORD ALPORTMy Lords, may I ask the noble Lord whether his first Answer means that no steps will be taken by the Chancellor of the Exchequer for the space of five months, until the middle of April of next year, to clear up the existing uncertainties and apprehensions?
§ LORD RHODESMy Lords, I think that question is quite wide of the original Question.
§ LORD LUCAS OF CHILWORTHNo, it is very germane to it.
§ VISCOUNT BRENTFORDMy Lords, may I ask the Minister whether that answer is quite fair?—because it seemed to me that the supplementary question put to him was well within the scope of the original Question. Secondly, may ask him whether he has considered this matter from the point of view of pension funds, many of which hold considerable amounts of these stocks, and the trustees of which have been put into an impossible position by the doubts which have been raised in their minds by the Chancellor of the Exchequer?
§ LORD RHODESMy Lords, I am afraid I must reiterate my original Answer: the noble Lord must await my right honourable friend's presentation.
§ LORD FORSTER OF HARRABYMy Lords, I thank the noble Lord for his Answer. I will renew the Question at a time when he is better informed.
§ LORD AIREDALEMy Lords, does not the noble Lord think that, unless an answer to this Question is forthcoming fairly soon, there is bound to be chaos in the market in gilt-edged securities between now and the Budget Day of 1965?
§ LORD RHODESMy Lords, I think the replies will be forthcoming.
§ LORD ELLENBOROUGHMy Lords, could the noble Lord tell us whether the Chancellor of the Exchequer is under instructions from his Hungarian forces deliberately to maintain uncertainty for as long as possible and depress values as much as possible between now and Budget day?