§ Mr. de Freitas
asked the Chancellor of the Exchequer whether he is aware that a large number of people are seriously affected financially by the fall in the value of gilt-edged securities; whether he will consider a level below which he will not allow the value of these securities to fall; and what are the terms of the agreement between the Government and the holders of these securities in this respect.
§ Mr. Barber
I am well aware that all holders of gilt-edged securities are affected by a fall in the market value of their holdings, and that such a fall may involve actual loss for those who are obliged to sell. The conditions on which stock is issued are defined in the prospectus for each issue: broadly speaking, they relate to the rate and frequency of interest payments and the date of redemption, which in the case of the undated stocks is not fixed but is at the option of the Government. They do not include any obligation in respect 15W of the prices at which stock is bought and sold in the market. Her Majesty's Government are not prepared to set a "floor" to market prices, since they do not believe that the market should be insulated by official action from buying or selling pressures by holders. But the hon. Gentleman will be aware that the Government issue a variety of non-negotiable securities redeemable at short notice, which are available for small investors who do not wish to incur the risk of fluctuations in market prices.