Tanganyika (Financial Assistance)

– in the House of Commons at 12:00 am on 4th August 1961.

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Photo of Mr Iain Macleod Mr Iain Macleod , Enfield West 12:00 am, 4th August 1961

I am circulating in the OFFICIAL REPORT the text of a joint communiqué by Her Majesty's Government and the Tanganyika Government on the assistance which we intend to afford to Tanganyika which is being published this morning.

Briefly we shall give Tanganyika the £4·75 million of Colonial Development and Welfare money already allocated, an additional development grant of £4 million and a Commonwealth Assistance loan up to £4 million to the extent that this is required over and above the £8·75 million of grants and any other sums which may be available from other sources in order to finance the Tanganyika Government's new three-year Development Plan of £8 million a year. In addition, we shall make an interest-free loan, with a grace period on repayment, of £6 million towards the compensation scheme; and a loan of £3 million on the normal terms for Commonwealth Assistance loans towards commutation of pensions. We shall provide certain sums in respect of the Tanganyika Agricultural Corporation and hand over the assets of the Corporation, valued at £1 million: we shall pay for the Tanganyika military forces up to 31st March next year, about £200,000, and also make a cash payment for Tanganyika's share of the stores of the East African land forces, £34.000. We intend to enter into a Technical Assistance Agreement with the Tanganyika Government; and finally, the Colonial Development Corporation is investigating certain projects for which they may give assistance.

In our present economic circumstances, any proposal for additional overseas aid must necessarily be looked at with great care. But we recognise the quite exceptional importance of enabling Tanganyika to proceed with confidence with implementing her Plan. I have, therefore, felt it right to increase our original offer of assistance and to re-design it to meet Tanganyika's needs.

It is our hope and belief that other friendly Governments will wish to join in helping Tanganyika with her Development Plan. I have greatly welcomed the visit to London of the Governor to represent Tanganyika's future needs, which he has done with great ability; and I am also glad to say that Mr. Nyerere has expressed satisfaction with this settlement.

Photo of Mr Hilary Marquand Mr Hilary Marquand , Middlesbrough East

Is the right hon. Gentleman aware that from this side of the House we welcome with great pleasure the statement which he has just made, especially because we have his assurance that the rather lengthy agreement which he has read out has the full approval of Mr. Nyerere and his Government? May I also echo what he said about the Governor of Tanganyika, whose skill in negotiations no doubt played a valuable part in this exercise? Is the right hon. Gentleman aware, however, that the Governor's visit to this country would have been completely unnecessary if Her Majesty's Government had at the beginning put forward to the Tanganyikan Government a reasonable and acceptable settlement like this?

Is the Colonial Secretary aware that hon. Members on this side of the House certainly feel that the Questions which we put down and the debate which we initiated on the problems of East Africa have thoroughly justified our activities in this Session of Parliament? I know that some hon. Members opposite also took part. We are grateful that the pressure on the Government has now put them into this highly satisfactory position in relation to the great country of Tanganyika. May I conclude by wishing prosperity to Tanganyika and its Government and people in working out their valuable and progressive three-year plan?

Photo of Mr Iain Macleod Mr Iain Macleod , Enfield West

I am grateful to the right hon. Gentleman. It is very satis-factory to be able to end the term—quite a strenuous term—on a note which I know hon. Members on both sides of the House will warmly endorse. It is true, as the right hon. Gentleman has said, that many of my hon. and right hon. Friends have been deeply concerned about this matter and have made representations to me. It is a matter of deep satisfaction to me that at this stage in the development of Tanganyika we can say we have reached agreement on this, perhaps the last main issue that lay between us.

Photo of Mr Patrick Wall Mr Patrick Wall , Haltemprice

May I congratulate my right hon. Friend on being able to achieve this most satisfactory settlement which will enable Tanganyika to take her rightful status in the Commonwealth? May I ask whether there is any question of phasing the amount of money towards the Development Plan and whether this grant and loan will enable Tanganyika to fulfil the plan which has already been adopted in Dar-es-Salaam?

Photo of Mr Iain Macleod Mr Iain Macleod , Enfield West

My hon. Friend will be able to study the official communiqué which is published this morning and which goes into more detail of the phasing in relation to the Development Plan. That is really what I meant by saying that we have redesigned this part to meet Tanganyika's needs?

Photo of Mr John Stonehouse Mr John Stonehouse , Wednesbury

May I associate myself with the congratulations extended to the Colonial Secretary on reaching this new agreement? May we ask how he has managed to succeed with the Chancellor whereas the N.U.T. has not yet succeeded? May I ask, further, what commitments he has entered into with regard to the second and the third—

Photo of Sir Harry Hylton-Foster Sir Harry Hylton-Foster , Cities of London and Westminster

Order. What I am permitted to allow are some questions on the subject matter of the statement. There is nothing in the statement about the N.U.T.

Photo of Mr John Stonehouse Mr John Stonehouse , Wednesbury

May I ask the Colonial Secretary what commitments he has entered into with regard to the second and third years of the Development Plan?

Photo of Mr Iain Macleod Mr Iain Macleod , Enfield West

I very much wish that we could make an offer of £42 million to Tanganyika. That does not strike me as an ungenerous figure. All the amounts that I put here are really related. Some of them, like the compensation, will be spread over a longer period. But the moneys related to the development scheme are related to the three-year plan and will presumably be drawn down within that period.

Photo of Mr John Dugdale Mr John Dugdale , West Bromwich

Is the Colonial Secretary aware that hon. Members on this side of the House have been astonished that even this Government could manage to infuriate a man so reasonable and charming as Mr. Nyerere, and that we are delighted that, owing to the efforts of the Colonial Secretary, the Government have now been persuaded to change their attitude and to be more reasonable? As my right hon. Friend has said, we think that it is apparently due to the pressure from this side of the House on the Government on this matter?

Photo of Mr Iain Macleod Mr Iain Macleod , Enfield West

I should like to say at this point, as I think is obvious because I do not myself provide moneys, that I have had a most satisfactory response to my proposal and to the announcement I have made from my right hon. and learned Friend the Chancellor, who realised very well the importance of the proposals I was putting before him.

Photo of Brigadier Terence Clarke Brigadier Terence Clarke , Portsmouth West

May I add my congratulations to my right hon. Friend, and also congratulate the Chancellor of the Exchequer, who has seen the light in very difficult times? May I say how delighted must all the friends of Tanganyika be that we have done right by the country despite our troubles? May I ask my right hon. Friend whether we shall give full co-operation to Mr. Nyerere should he seek other finances from other friendly Powers to complete the financing of this development plan?

Photo of Mr Iain Macleod Mr Iain Macleod , Enfield West

Yes, certainly. That is well in hand. Although I cannot make any announcement about it and it would not be right for an announcement to come from me or from the British Government, I am very satisfied with the progress which we have been making with other countries.

Following is the communique:Her Majesty's Government have reviewed with the Tanganyika Government the financial resources which are likely to be available to that Government for recurrent and capital expenditure, particularly in respect of the three-year Development Plan, in the immediate future. Her Majesty's Government have agreed, subject as necessary to the approval of Parliament, to give the following assistance to Tanganyika:

  1. (1) The balance of the Colonial Development and Welfare monies already promised to Tanganyika is estimated to be £4·75 million at the present time. This sum will continue to be available in the form of grants, for purposes to be agreed with the Tanganyika Government, £1 million to be available before independence, and the balance, spread evenly over the period of the Plan.
  2. (2) An additional special grant towards the Development Plan of £4 million, available to be drawn evenly over the three years of the Plan, beginning from 1st July, 1961.
  3. (3) A Commonwealth Assistance loan over the period up to a total of £4 million, to the extent that additional sums up to this amount, over and above the grants referred to above and any other sources of finance which may become available, are required to finance the Tanganyika Government's development programme.
  4. (4) An interest-free loan of £6 million, with a grace period on repayment, to assist the Tanganyika Government to meet its share of the compensation scheme for overseas officers.
  5. (5) A separate loan of £3 million on the normal terms for Commonwealth Assistance loans to assist the Tanganyika Government in respect of the commutation of pensions of officers retiring from the service.
  6. (6) The sum of up to £109,000 which is estimated by the Tanganyika Government to be required by the Tanganyika Agricultural Corporation in the year ending 30th September, 1962, from the grants provided for in the Tanganyika Agricultural Corporation Act, 1957. Her Majesty's Government have also agreed to extend to ten years the period of repayment of the £90,000 remaining to he repaid from the interest-free loan made to the Corporation. In addition Her Majesty's Government have agreed to transfer to the Tanganyika Government their rights of ownership of the Corporation's assets, which are valued at about £1 million.
  7. (7) Her Majesty's Government will continue to meet the costs of Tanganyika's military forces in the period following independence until the 31st March, 1962, up to about £200,000; and will also make a cash payment for Tanganyika's share (estimated at £34,000) of the stores of the East African Land Forces.
  8. (8) Her Majesty's Government will also be happy to enter into a Technical Assistance agreement with the Government of Tanganyika after independence.

2. In addition the Colonial Development Corporation is in process of investigating certain new projects in Tanganyika and, subject to examination of detailed proposals on the usual criteria and the willingness of the Corporation to proceed. Her Majesty's Government will give favourable consideration to participation by the Corporation up to about £0·75 million.

Motion made, and Question proposed, That this House do now adjourn.—[Mr. Redmayne.]