Orders of the Day — Public Investment

Part of the debate – in the House of Commons at 12:00 am on 10th November 1960.

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Photo of Mr Alan Hopkins Mr Alan Hopkins , Bristol North East 12:00 am, 10th November 1960

I agree with the hon. Member for Leek (Mr. Harold Davies) about the importance of the uncommitted countries of Africa and Asia. I wish to return to a point made by my hon. Friend the Member for Scarborough and Whitby (Sir A. Spearman) regarding the question of priorities. It is all very well to talk about industrial expansion, in which I strongly believe, but at the same time we must consider the importance to this country of our balance of payments position. Expansion at too rapid a rate will land us in a balance of payments crisis, and it is extremely difficult to escape from the resultant spiral.

A delicate balance has to be maintained in order that we may retain our standard of living in these islands. Undoubtedly, exports are the key to that balance. Without increasing exports it is idle to talk about expansion and pumping more credit into the economy for increasing our home production. Therefore, I welcome the moves and the exhortations made by my right hon. and learned Friend the Chancellor of the Exchequer's predecessor earlier this summer, and by other right hon. Friends to encourage manufacturers to export more.

I well remember, when I was somewhat younger, learning to ride a horse over jumps. It is all very well shouting and cheering on the horse when one comes up to a jump, but unless one does something the jump will not be negotiated. I confess that despite many attempts to do something I often fell off. But I am quite sure that my right hon. Friends who are in the saddle, and facing the hurdle of promoting exports, will not end up in the ditch as I so frequently did. It is not sufficient to exhort and encourage exporters and manufacturers in this country to export more goods if those exhortations are not matched by Government action.

Therefore, I am very glad that the President of the Board of Trade announced certain measures for the increase of credit and facilities offered by the Export Credits Guarantee Department about a month ago. They seem to be a step in the right direction. I also welcome the establishment of the Council for Exports in Europe on much the same lines as the most successful Dollar Export Council. I wonder, however, whether the Chancellor and the Economic Secretary will consider that those measures are sufficient.

My hon. Friend the Member for Harwich (Mr. Ridsdale), in his most interesting speech, suggested that we might have a Government political guarantee fund for British exporters who were exporting to under-developed countries where there might be some problems of immediate repayment for the capital goods exporters of this country. That might well be a solution. Whether it is the right solution or not, the attention of the Chancellor and of the Economic Secretary should be directed to this most important point of increasing our exports without which a large expansion at home seems idle.

I turn to the very important point made by the hon. Member for Leek, the question of our duty on humanitarian and economic as well as political grounds to do something to help investment in the under-developed countries. I want to make only a short point because I know that many other hon. Members wish to take part in the debate. According to the White Paper, we as a country are supposed to contribute £300 to £350 million a year. It is quite clear that we cannot increase that amount at the moment having regard to our balance of payments position. There is no doubt, also, that the overall position of Western investment in the under-developed countries can and should be increased substantially over the next five to ten years.

One of the troubles seems to be that in America there are ten or eleven agencies each of which has a responsibility for directing aid to one area of the world or another. I am not talking about military aid, but economic aid. We in this country have no fewer than three different funds and there are also those in Europe. There is the extremely effective World Bank under the very capable direction of Mr. Eugene Black. One possible solution is to increase the capital available to the World Bank, which is so highly regarded not only by the people in America and ourselves and in Europe but by the people that it seeks to help.

Another solution seems to be that a degree of co-ordination of these various agencies operating in America, here and in Europe might achieve a comprehensive and coherent plan for increasing and expanding investment in the underdeveloped countries. This would result in benefit for all parties concerned. I realise that these are very difficult questions, and I certainly would not suggest that the solutions I have put forward are necessarily the right ones, but I should like an assurance from the Economic Secretary that they are very much in the forefront of his mind, for without them I cannot see very much in the way of hope of expansion of investment here and abroad for this country.