§ Mr. RUPERT GWYNNEasked the Under-Secretary of State for India if he will lay upon the Table a copy of the contract with Messrs. Samuel Montagu and Company for the purchase of silver, and a copy of the terms on which they were instructed to purchase?
§ Mr. HAROLD BAKERsubmitted the following correspondence conveying instructions to Messrs. Samuel Montagu and Company for purchases of silver on behalf of the Secretary of State for India in Council, and specimen of contract notes (referred to in the correspondence as "contracts") used in reporting the several purchases:—
No. 1.
Letter from the India Office to Messrs. Samuel Montagu and Company, dated 4th March, 1912.
"I am directed to inform you that the Secretary of State for India in Council will be obliged if you will gradually purchase on his behalf bar silver up to the value of £500,000. He leaves it to your discretion to purchase at such times and in such amounts as you may consider expedient, with the object of avoiding, to the utmost extent possible, any action likely to raise the price of the metal or to reveal the fact that the purchases are on his behalf. All purchases should, until 2112W further notice, be made for forward delivery—i.e., for delivery either two months after the date of the contract, in accordance with the usual practice, or by preference at a later date not being subsequent to 31st July. It is requested that you will keep Sir Felix Schuster informed of the action taken by you and will refer to him on any point on which consultation may seem desirable. Contracts for the silver purchased should be sent by you, marked 'Confidential,' to the Financial Secretary, India Office, and when you obtain delivery of silver, the warrants should be sent to the same address with applications for payment. It is understood that you wish payment to be made to your bankers, the Union of London and Smiths Bank, at their head office, Prince's Street, E.C. If so, will you be good enough to send to this office a letter conveying the necessary authority? When arrangements have been made for the shipment of any silver, the warrants will be returned to you, and a member of this Office will call for the bills of lading in order that they may be posted to India without delay."
No. 2.
Letter from India Office to Messrs. Samuel Montagu and Company, dated 25th March, 1912.
"I am directed to acknowledge the receipt of your letter of the 22nd instant enclosing a contract (No. 14) for the purchase of about £70,000 fine bar silver on behalf of the Secretary of State for India in Council, in completion of the order for £500,000 given to you in Mr. Abrahams' letter of 4th March. I am now directed to request that you will be so good as to proceed to make further purchases, on behalf of the Secretary of State in Council, up to a value of £250,000. The remarks in the letter of 4th March as to the method and conditions of purchase, etc., will be understood as applying equally to the present order."
No. 3.
Letter from India Office to Messrs. Samuel Montagu and Company, dated 15th April, 1912:—
"With reference to previous correspondence, I am directed by the Secretary of State for India in Council to request that you will be so good as to make further purchases of silver on his behalf gradually up to a value of £250,000, subject to the condition agreed upon in respect of the last order, and to your being able to purchase at no great advance on the present 2113W price. Should the price rise to any material extent before this order is completed, I am to request that you will be so good as to consult with Sir Felix Schuster as to the expediency of continuing purchases or temporarily suspending them."
No. 4.
Letter to India Office from Messrs. Samuel Montagu and Company, dated 16th April, 1912:—
"We beg to acknowledge, with many thanks, receipt of your letter of yesterday's date, requesting us to purchase for you a further amount of £250,000 fine bar silver, on the same conditions as usual. We note that you do not wish us to buy at a material advance in price without consulting Sir Felix Schuster. This order we shall endeavour to carry out with the same secrecy as we have been fortunate enough to maintain hitherto. We enclose your contracts of our to-day's transactions, for your account, amounting to £35,000. As the time is approaching when we shall have to take up our first deliveries on your behalf, we would be glad to know if you desire us to postpone the due dates for two months at the market rates. We believe that the difference will remain ⅛d., equal to a shade under 3 per cent, on the money (per annum). The chief advantage to you would be the avoiding of any premature transactions with the Bank of England. For the movement of actual bars from our offices to the Bank might cause comment, though we do not believe for one moment that anyone would guess the nature of the business. There would be a brokerage of ⅛ per cent, to pay us for the postponement, but this would, naturally, be only one side of the account."
No. 5.
Letter from Messrs. Samuel Montagu and Company, to the India Office, dated 17th April, 1912:—
"We have the pleasure of sending you contracts for the purpose of £55,000 silver. The price rose to-day on purchases by the bazaar, which is influenced by the further fall of about 80 lakhs in the silver reserve. The opinion prevails among the Eastern banks that there is not likely to be any influx until June. It is on account of this that we have been a little freer with our buying, although we only took about a third of what was offering at 'fixing.' We hope that you approve of our action."
2114WNo. 6.
Letter from India Office to Messrs. Samuel Montagu and Company, dated 18th April, 1912:—
"I am directed to acknowledge the receipt of your letters of 16th and 17th April enclosing contracts for the purchase of £90,000 silver on those two days. In reply to the inquiry in your letter of the 16th, I am to say that your proposal to postpone for two months, at market rates (at present ⅛d.), the dates of delivery of silver shortly falling due, and to charge a brokerage of ⅛ per cent, for the postponement, is accepted."
No. 7.
Letter from India Office to Messrs. Samuel Montagu and Company, dated 20th May, 1912:—
"With reference to previous correspondence, I am directed by the Secretary of State for India in Council to request that you will be so good as to make further purchases of silver on his behalf up to a value of £250,000, subject to arrangements as to price, date of delivery, etc., to be made in communication between you and Sir Felix Schuster."
No. 8.
Letter from India Office to Messrs. Samuel Montagu and Company, dated 1st June, 1912:—
"With reference to previous correspondence, I am directed by the Secretary of State for India in Council to request that you will be so good as to make further purchases of silver on his behalf up to a value of £250,000, subject to arrangements as to price, date of delivery, etc., to be made in communication between you and Sir Felix Schuster."
No. 9.
Letter from India Office to Messrs. Samuel Montagu and Company, dated 20th June, 1912.
"With reference to previous correspondence, I am directed by the Secretary of State for India in Council to request that you will be so good as to make further purchases of silver, gradually, on his behalf for cash, up to a value of £250,000, subject to reference to Sir Felix Schuster, in case of any material change occurring in the price or in the relation between prices for cash and for forward delivery."
No. 10.
Letter from India Office to Messrs. Samuel Montagu and Company, dated 27th June, 1912.
2115W"In continuation of my letter of the 20th June, I am directed by the Secretary of State for India in Council to request that you will be so good as to make further purchases of silver, gradually, on his behalf for cash, up to a value of £250,000, subject to reference to Sir Felix Schuster, in case of any material change occurring in the price or in the relation between prices for cash and for forward delivery."
No. 11.
Letter from India Office to Messrs. Samuel Montagu and Company, dated 30th July, 1912.
"I am directed to request that you will be so good as to make further purchases of silver, as favourable opportunity may offer, up to the value of £500,000 on behalf of the Secretary of State for India in Council. You may buy either for cash or for two months' forward delivery as you may consider most advantageous, in consultation with Sir Felix Schuster."
No. 12.
Letter from India Office to Messrs. Samuel Montagu and Company, dated 9th August, 1912.
"In continuation of previous correspondence I am directed to request that, when you have completed the purchase of £500,000 of silver at present in progress, you will be so good as to make further purchases, as favourable opportunity may offer, up to the same amount (namely, £500,000), on behalf of the Secretary of State in Council. You may buy either for cash or for two months' forward delivery, as you may consider most advantageous, in consultation with Sir Felix Schuster."
No. 13.
Letter to Messrs. Samuel Montagu and Company from the India Office, dated 28th August, 1912.
"In continuation of previous correspondence, I am directed to request that you will be so good as to make further purchases of silver, as favourable opportunity may offer, up to the amount of £500,000 on behalf of the Secretary of State in Council. You may buy either for cash or for forward delivery, as you may consider most advantageous in consultation with Sir Felix Schuster."
No. 14.
Letter from India Office to Messrs. Samuel Montagu and Company, dated 3rd September, 1912.
2116W"In continuation of my letter of 28th August I am directed to request that you will be so good as to make further purchases of silver, as favourable opportunity may offer, up to the amount of £500,000 on behalf of the Secretary of State in Council. You may buy either for cash or for forward delivery as you may consider most advantageous in consultation with Sir Felix Schuster."
No. 15.
Letter from India Office to Messrs. Samuel Montagu and Company, dated 11th September, 1912.
"In continuation of my letter of the 3rd instant, I am directed to confirm the instructions given to you by Sir Felix Schuster for the purchase of a fifth million of silver, £700,000 of which, it is understood, you have already secured."
Specimen of contract notes furnished to the India Office by Messrs. Samuel Montagu and Company in reporting the several purchases:—
"Samuel Montagu and Company, No. 1.
60, Old Broad Street,
London, 5th March, 1912.
"Bought for the Secretary of State for India in Council, about £50,000 fine bar silver, at 26⅝ per oz. std.
"Delivery, £40,000, 6th May.
£10,000, 30th June.
"(Sd.) Samuel Montagu and Company."
§ Mr. RUPERT GWYNNEasked the Under-Secretary of State for India, if he can say whether the figures specified on 6th November to be the maximum sums held on any one date in the preceding twelve months by approved borrowers represents moneys lent to approved borrowers; and, if not, will he state the difference between the amounts of sums held and sums lent, and how they arise?
§ Mr. HAROLD BAKERThe answer to the first part of the question is in the affirmative. The figures specified on 6th November exceed £8,950,000 (the amount on loan and on deposit on 22nd October, 1912) because they show, as requested by the hon. Member, not the portions of the £8,950,000 held by the various firms, but the maximum held at any date in the year each borrower who, on 22nd October held part of the £8,950,000.
§ Mr. RUPERT GWYNNEasked if the Under-Secretary of State for India will 2117W give the names of the sellers from whom purchases of silver were made by Messers. Samuel Montagu and Company on behalf of the Government, with the amount, the price, and the date in each case during the present year?
§ Mr. BAKERSilver purchased through Messers. Samuel Montagu and Company, 1912:—
2118W
Date of Purchase. Amount. Price per oz. 1912. £ d. 5 March … … 40,000 26 ⅝ 5 March … … 10,000 26 ⅝ 7 March … … 10,000 26 11/16 7 March … … 30,000 26 ¾ 7 March … … 15,000 26 ¾ 8 March … … 40,000 26 11/16 8 March … … 7,000 26 11/16 11 March … … 35,000 26 13/16 12 March … … 20,000 26 ⅞ 13 March … … 20,000 26 13/16 14 March … … 73,000 26 ⅞ 18 March … … 35,000 26 13/16 18 March … … 20,000 26 13/16 19 March … … 5,000 26 ⅞ 19 March … … 10,000 26 ⅞ 20 March … … 46,000 26 ⅞ 20 March … … 4,000 26 ⅞ 21 March … … 10,000 26 13/16 22 March … … 70,000 26 15/16 26 March … … 15,000 26 ⅞ 27 March … … 35,000 26 13/16 27 March … … 5,000 26 13/16 28 March … … 15,000 26 ⅞ 28 March … … 25,000 26 ⅞ 29 March … … 15,000 26 13/16 30 March … … 12,000 26 ¾ 1 April … … 18,000 26 13/16 1 April … … 20,000 26 13/16 2 April … … 5,000 26 ⅞ 3 April … … 20,000 27 ⅛ 4 April … … 15,000 27 3/16 4 April … … 30,000 27 3/16 6 April … … 9,000 27 ⅛ 9 April … … 6,000 26 15/16 9 April … … 5,000 26 15/16 16 April … … 6,000 27 1/16 16 April … … 23,O00 27 16 April … … 6,000 27 1/16 17 April … … 10,000 27 ¼ 17 April … … 5,000 27 ¼ 17 April … … 30,000 27 ¼ 17 April … … 10,000 27 3/16 18 April … … 29,000 27 7/16 18 April … … 11,000 27 7/16 19 April … … 27,000 27 ½ 22 April … … 13,000 27 ½ 23 April … … 11,000 27 5/8 24 April … … 19,000 28 1/16 26 April … … 40,000 28 ⅛ 26 April … … 10,000 28 ⅛ 21 May … … 19,500 28 ¼ 21 May … … 19,500 28 5/16 22 May … … 7,500 28 ⅛ 22 May … … 7,500 28 3/16 2119W
Date of Purchase. Amount. Price per oz. 1912. £ d. 24 May … … 40,000 28 24 May … … 40,000 28 1/16 25 May … … 6,000 28 ⅛ 28 May … … 110,000 28 ⅛ 3 June … … 30,000 27 15/16 4 June … … 100,000 28 1/16 6 June … … 100,000 28 7 June … … 20,000 28 20 June … … 70,000 28 ⅜ 21 June … … 45,000 28 7/16 22 June … … 9,000 28 9/16 24 June … … 80,000 28 9/16 24 June … … 8,000 28 9/16 25 June … … 25,000 28 7/16 26 June … … 13,000 28 5/16 27 June … … 75,000 28 ⅜ 28 June … … 100,000 28 ¼ 2 July … … 40,000 28 ⅛ 4 July … … 23,000 28 3/16 5 July … … 12,000 28 ⅛ 31 July … … 30,000 27 ¾ 31 July … … 30,000 27 ⅞ 2 August … … 100,000 27 ⅝ 6 August … … 15,000 27 9/16 6 August … … 60,000 27 ⅝ 6 August … … 20,000 27 ¾ 7 August … … 10,000 27 ⅝ 7 August … … 50,000 27 11/16 8 August … … 63,000 28 3/16 8 August … … 25,000 28 1/16 8 August … … 7,000 28 3/16 9 August … … 35,000 28 1/16 9 August … … 5,000 28 3/16 10 August … … 6,000 28 3/16 12 August … … 35,000 28 ⅛ 13 August … … 10,000 28 ⅜ 13 August … … 5,000 28 5/16 14 August … … 120,000 28 7/16 15 August … … 45,000 28 9/16 15 August … … 30,000 28 ¾ 15 August … … 15,000 28 ⅝ 16 August … … 234,000 28 13/16 17 August … … 40,000 29 ⅛ 17 August … … 10,000 28 13/16 28 August … … 10,0U0 28 ⅜ 29 August … … 20,000 28 9/16 30 August … … 10,000 28 11/16 30 August … … 100,000 28 13/16 30 August … … 100,000 28 13/16 31 August … … 10,000 28 ⅞ 2 September … … 12,000 28 13/16 2 September … … 102,000 28 ⅛ 2 September … … 100,000 28 ⅞ 2 September … … 100,000 28 13/16 3 September … … 100,000 28 ⅞ 3 September … … 50,000 28 ⅞ 3 September … … 10,000 28 ¾ 4 September … … 15,000 28 ¾ 4 September … … 15,000 28 15/16 4 September … … 100,000 28 15/16 4 September … … 50,000 28 15/16 5 September … … 100,000 28 ⅞ 5 September … … 50,000 28 ⅞ 5 September … … 30,000 28 ¾ 5 September … … 21,000 28 ⅞
Date of Purchase. Amount. Price per oz. 1912. £ d. 6 September 100,000 28 ⅞ 11 September 100,000 28 13/16 11 September 200,000 29 ⅛ 11 September 300,000 29 ⅛ 11 September 100,000 29 ⅛ 16 September 100,000 28 ¼ 24 September 200,000 28 11/16 (Approximate) £5,205,000* * This amount was reduced by net sales amounting to £205,000. "London, 13th November, 1912.
"Financial Secretary,
"The India Office,
"Whitehall.
"Dear Sir,—In reply to your inquiry we beg to inform you that the custom of the bullion trade is that a broker who makes a contract is responsible both to the buyer and the seller for the due fulfilment of the contract. This has always been the custom, as our clients on either side require it, and they would consider it a breach of confidence if their names were divulged.—We are, Dear Sir, your obedient servants,
(Signed) "Mocatta and Goldsmid.
"Pixley and Abell.
"Sharps and Wilkins."
[See Oral and Written Answers, Tuesday, 19th November, 1912.]