HL Deb 28 June 1965 vol 267 cc666-7

2.38 p.m.

LORD ERROLL OF HALE

My 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, when making changes in their portfolio of North American investments, they repatriate 25 per cent. of the proceeds of any sale, in the same way as private investors are now required to do; and if so, how much has so far been repatriated.]

LORD SHEPHERD

My Lords, the answer to both questions is in the negative.

LORD ERROLL OF HALE

My Lords, I thank the noble Lord for such a brief Answer, but is it not unfortunate that the Government should tell private investors to pursue one course of action which is unfavourable to them while not disciplining themselves to the same extent by making similar repatriations on the switching of their own portfolios?

LORD SHEPHERD

My Lords, I am rather disturbed that the noble Lord does not understand the purpose of the Government in requesting those private investors who sell or switch their non-sterling investment to repatriate 25 per cent. of the proceeds. This is being done in order to strengthen the gold and dollar reserves. The portfolio that is held by Her Majesty's Government is at all times available in support of the gold and dollar reserves. Therefore there is no necessity to return proceeds to this country if and when any of those shares are sold. May I stress that these shares held by Her Majesty's Government are at all times available for the support of gold and dollar reserves?

LORD ERROLL OF HALE

My Lords, would it not be desirable for Her Majesty's Government to carry out what they are expecting other people to do?

LORD SHEPHERD

My Lords, the noble Lord still does not understand the purpose of asking private investors to return 25 per cent. when they sell or switch their shares. This is in order to support the gold and dollar reserves. The shares held by Her Majesty's Government are at all times available for the support of the gold and dollar reserves and there would be no point or purpose in returning those sums to this country.

LORD ERROLL OF HALE

My Lords, may I ask the noble Lord whether it is not the case that it would be impossible for them to realise the whole of those holdings at any time, and therefore would it not be very much more satisfactory to repatriate relatively small amounts from time to time as switches take place and so enable Her Majesty's Government to increase the gold and dollar reserves, as they are asking private shareholders to do?

LORD SHEPHERD

My Lords, the noble Lord must understand that these shares held by Her Majesty's Government can be used for loans where they can be used for collateral. And perhaps I may remind the noble Lord of what Mr. Macmillan said in 1956: that these dollar securities could be a substantial reinforcement to the reserves and he was prepared to use them for that purpose.

LORD BARNBY

My Lords, with regard to the Written Question to which the noble Lord replied on May 17 of this year, with reference to the net investment abroad under both private and official investment, could the noble Lord say what he expects will be the income from the proposed sales as against these foreign investments which he reported?

LORD SHEPHERD

My Lords, the Chancellor of the Exchequer, speaking in another place some time ago, said he would expect £50 million, and the present figures which are available would lead us to think that this would be close to the figure.