HC Deb 06 June 1978 vol 951 cc121-2W
Mr. Cant

asked the Chancellor of the Exchequer whether, in order to moderate the growth of money supply, he will reintroduce the control over the banking system, popularly referred to as the corset.

Mr. Denzil Davies

The growth in bank lending to the private sector in recent months has been by no means excessive. However, I shall be ready to use any appropriate weapon to ensure that this and other components of monetary growth are kept to the desired trend. The supplementary special deposits scheme remains in place, and I reserve the right to reactivate it if and when necessary. If reactivated, the scheme might, as has been made clear, be based on figures for interest-bearing eligible liabilities some months in arrears.

Mr. Lawson

asked the Chancellor of the Exchequer what is the explanation of the difference between the money supply figures for 1974 given in the Written Answer to the hon. Member for Blaby on 24th May, and the figures for the same period provided in the Written Answer to the hon. Member for Blaby on 13th April.

Mr. Denzil Davies

Between the two dates to which the hon. Member refers, revisions were made by the Bank of England to the seasonal adjustments to the money supply series. These affected particularly those months listed in the Bank of England's Press release of 11th May but also most months since 1971. Revisions made to the rates of growth calculated on three-month and six-month periods are magnified when grossed up to annual rates.