§ 11.14 a.m.
§ LORD GRANTCHESTERMy 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 Prime Minister was correctly reported as having stated, during his recent visit to Paris, when questioned about Great Britain's short-term financial liabilities, amounting to some £3,000 million, that these liabilities were amply covered by overseas investments; and whether Her Majesty's Government will state to what investments the Prime Minister was referring, and to whom they belong.]
§ THE EARL OF LONGFORDMy Lords, my right honourable friend the Prime Minister explained, in answer to a question at his Press conference in Paris on January 25, that the United Kingdom possessed total overseas assets on a scale considerably greater than the total of the country's external obligations, short-term and long-term. Thus, at the end of 1964 the United Kingdom had total net monetary liabilities to official 1094 and private holders overseas of about £2,000 million. At the same time the United Kingdom held net long-term assets overseas of some £4,300 million; these net assets included official assets of over £800 million gross and private assets of over £9,400 million gross. After making allowance for developments in 1965 and 1966, the United Kingdom remains a very large net creditor in the world. My Lords, a more detailed estimate of the United Kingdom's external assets and liabilities, as at the end of 1964, was published in the Pink Book, The United Kingdom Balance of Payments, 1966.
§ LORD GRANTCHESTERMy Lords, I thank the noble Earl the Leader of the House for his reply. Is it not correct that, for example, the Malaysian Minister of Finance informed the International Monetary Fund at their meeting in September last that as soon as possible, without putting undue strain on sterling, Malaysia intended to diversify her sterling holding in London? Has not Her Majesty's Government to expect this sort of orthodoxy to be expressed by other Governments holding sterling in London, and would not any discouragement of this course make sterling no longer a freely convertible currency and thus diminish its status?
§ THE EARL OF LONGFORDMy Lords, I hesitate to wear my other hat as the Leader of the House and suggest to the noble Lord that his supplementary question is far removed from the original Question. I suppose I must not seek to defend myself on such grounds, but had anyone else been answering this Question, I should have said that the noble Lord's supplementary question bore no relationship to his original Question. I am afraid that, without notice, I cannot be expected to confirm or deny the precise wording of some statement made by a particular Government last autumn. I would only commend to the noble Lord, if he is worried about the future, the fact that it is a long time since sterling has been riding so high—as the noble Viscount, Lord Watkinson, was good enough to point out in the debate on Wednesday.
§ THE EARL OF DUNDEEMy Lords, I wonder whether the noble Earl would be kind enough to repeat the figures of 1095 our assets abroad at the end of 1964. I thought I heard him say that our assets were £4,000 million of which £9,000 million were privately owned, but I am sure that I must have misheard him.
§ THE EARL OF LONGFORDMy Lords, I find it impossible myself ever to understand figures and I am not at all surprised that the noble Earl misunderstood these. What I said was that the net assets—it is this distinction between net and gross assets—the net long-term assets, after setting off the counterclaims, which we held at the end of 1964 were £4,300 million, and these net assets included official assets of over £800 million gross and private assets of of over £9,400 million gross.
§ THE EARL OF DUNDEENine thousand?
§ THE EARL OF LONGFORDYes, £9,400 million gross. Now I look at the answer I see that it was not very happily worded, if I may say so. Although it is correct, it would be difficult, I suggest, to find a more obscure way of putting a simple point; but the facts are as I have stated.
§ THE EARL OF DUNDEEMy Lords, I am most grateful to the noble Earl; and I ought to have listened more carefully. But does it not follow that if there are over £9,000 million private assets and £800 million public assets, which comes to probably a little over £10,000 million, if our liabilities were £2,000 million only our net assets must surely have been more than £4,000 million?
§ THE EARL OF LONGFORDMy Lords, I do not think we can carry it very much further in this form, but if the noble Earl reads the Answer he will see that he is mistaken and that this is not a slip by the Treasury—that would be too good to hope for.