Capital Movements

Oral Answers to Questions — National Finance – in the House of Commons at 12:00 am on 19th December 1957.

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Photo of Mr John Cronin Mr John Cronin , Loughborough 12:00 am, 19th December 1957

asked the Chancellor of the Exchequer if he will now reinforce the control of capital movements to non-sterling countries and introduce controls on capital movements to the sterling area.

Photo of Mr John Cronin Mr John Cronin , Loughborough

Does not the right hon. Gentleman appreciate that, since the Government relaxed controls, the balance of trade surpluses earned by this country have been cancelled out year after year by capital movements, mostly of a fugitive or speculative nature? Has not the time come for the Chancellor of the Exchequer to overcome his party mania and face the situation squarely?

Photo of Mr Nigel Birch Mr Nigel Birch , Flintshire West

I think the experience of hon. and right hon. Members opposite when they were in office showed that the £ cannot be protected simply by controls of that sort. It is the general confidence in the policy of the Government which holds it up. The only thing we have done recently on exchange control has been to close the Kuwait gap. There has been no basic change.

Photo of Mr John Cronin Mr John Cronin , Loughborough

Are there not a Hong Kong gap and a Tangier gap through which large amounts of capital escape?

Photo of Mr Nigel Birch Mr Nigel Birch , Flintshire West

There is a Question later on the Paper about that.