§ 2.53 p.m.
§ Lord BESWICKMy Lords, I beg leave to ask the second Question which stands in my name on the Order Paper.
The Question was as follows:
To ask Her Majesty's Government what proportion of the £8,350 million interest payable on the National Debt in the year 1979–80 went to overseas stockholders.
§ Lord COCKFIELDMy Lords, this information is not available as the amount of interest paid to overseas stockholders is not separately recorded. However, in the year ended 31st March 1979 the percentage of National Debt held by overseas holders, including international organisations and central monetary institutions, was estimated at rather more than 11 per cent.
§ Lord BESWICKMy Lords, while thanking the noble Lord for the words he offers in answer to this Question, may I ask him whether it is not something over which we ought to brood that the whole of the public sector borrowing this year—the whole of it—will be required to pay interest on money already borrowed? Is it not also a fact, if one takes percentages and works on them, that something like half the total deficit in foreign payments is accounted for by the interest paid to foreign stockholders?
§ Lord COCKFIELDMy Lords, I am aware of both these points but, so far as the first point made by the noble Lord is concerned—namely, that the payments of interest on the National Debt last year will be equal to the public sector borrowing requirement—I have to remind him that during the period of office of the Labour Government the total National Debt 1135 more than doubled, and the amount of interest paid on the National Debt increased nearly threefold. That is a remarkable achievement, but not one to be particularly proud of.
§ Lord BESWICKMy Lords, is the noble Lord aware that I am not interested in scoring party points, but that I am trying to put before the House some facts which I think ought to cause us all to think very deeply? Is it not also a fact that the method of curbing money supply by interest rates is not showing results? I am simply suggesting to the noble Lord (and would he not take it in that spirit?) that we might have another look at this.
§ Lord COCKFIELDMy Lords, I am well aware of the fact that the noble Lord was not endeavouring to score party points, and that is why I drew his attention to the facts as they exist. The other point I would make to him, which is relevant in this connection, is that the total of interest, profits and dividends flowing into the United Kingdom is greater than the amount flowing out. On the international balance, therefore, we are in credit, and not in deficit.
§ Lord HARMAR-NICHOLLSMy Lords, is my noble friend aware that it is not scoring a party point to say that the increase in the National Debt over the five years to which he refers was higher than the increase over the previous 300 years? It is not trying to score a party point to say that we ought to learn from that lesson, because unless we reduce public spending then we are not able to reduce public indebtedness, and it is only by reducing public indebtedness that we can reduce the interest that has to be paid upon it. That is a fact which ought to be brooded upon, to use the word of the noble Lord opposite.
§ Lord COCKFIELDMy Lords, these are very valid points made by my noble friend Lord Harmar-Nicholls. The reason why we place such emphasis on the need to reduce the public sector borrowing requirement is because we are so fully aware of the points made both by the noble Lord, Lord Beswick, and by my noble friend who has just spoken.