Mr. T. WILSONasked the Chancellor of the Exchequer whether, in the event of the Government owing money to a merchant or other person abroad, such debt is paid in full in such a way that the creditor is not prejudiced by any adverse rate of exchange?
Mr. CHAMBERLAINIf the Government owes money in a foreign currency,e.g., dollars, the Government has to make payment in that currency, and whatever the rate of exchange the creditor receives the amount of foreign currency due to him and is unaffected by the rate of exchange. In some cases, however, the contract entered into by the Government may be to pay a person resident abroad a given amount of sterling in London. In such a case the risk of gain or loss on exchange falls on the creditor if he wishes to convert the sterling into some foreign currency.