HL Deb 21 December 1972 vol 337 cc1198-9
LORD GRANTCHESTER

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, as part of their anti-inflation plans, they will through the Bank of England request banks to display daily the price in paper currency at which they will sell a gold sovereign, as is the practice of banks of our European Economic Community partners.

THE MINISTER OF STATE, DEPARTMENT OF HEALTH AND SOCIAL SECURITY (LORD ABERDARE)

My Lords, since banks in this country do not normally sell gold sovereigns to members of the public, I do not think that the noble Lord's suggestion would serve the purpose he has in mind.

LORD GRANTCHESTER

My Lords, I thank the Minister for that Answer. Does not he think that the time may come quickly when people in this country will demand something more substantial than Government currency notes, as many of our compatriots in the Economic Community are doing? And should he not prepare to meet this demand?

LORD ABERDARE

My Lords, I realise that on the Continent it is not uncommon for gold to be held by individuals as a straight investment or as a hedge against inflation. But I hope that in this country we shall not go along that road, and that the Government's measures against inflation will prove successful and will avoid that necessity.

LORD GRANTCHESTER

My Lords, is it not rather a disappointing Common Market? The relations are not harmonised.

LORD ABERDARE

My Lords, this is not a question of harmonising relations, it is simply that the banks do not sell gold sovereigns. At the moment they are available through jewellers and shops of that sort, and they have a value which is quite different from the intrinsic value of the gold in them.

LORD FRASER OF LONSDALE

My Lords, do the words in the Minister's reply, "not normally" sold mean that they are sold only to collectors, or can anyone go and buy them at the appropriate places?

LORD ABERDARE

My Lords, they are not sold at all so far as I know. There is nothing to stop banks from selling them, but in fact all the trade in gold sovereigns is done through jewellers.

LORD LEATHERLAND

My Lords, is the Minister aware that it is hardly necessary to have gold as a hedge against inflation in this country because the Government are using land and bricks and mortar for that purpose, which is one reason why prices have risen so rapidly?

VISCOUNT MASSEREENE AND FERRARD

My Lords, is not the Minister aware that the Mint exports several million pounds worth of sovereigns every year? I think I am right in saying that it is quite a good export trade.

LORD ABERDARE

My Lords, I do not think that the noble Viscount is right. As a matter of fact, I think that the last gold sovereigns were minted in this country in 1968, although I know that the Mint does a great deal of work in making coins for other countries, which is a useful export trade.