We have listened with great interest to the speech of the hon. Member for Dewsbury (Mr. Ginsburg). If I may, I should like to deal later on with some of the points he has raised. During this debate and in the Budget the whole emphasis has been on our balance of payments deficit. I may say, in parenthesis, that very few of the suggestions in the Budget are going to help us to solve our balance of payments deficit. The thing that astounded me is that everybody accepts that exports are vital, but nowhere—either in the Government's White Paper or in the Queen's Speech, or in the Budget speech—was the question of international liquidity mentioned at all.
I would have thought that one of the reasons why exports are being held back—I am speaking on an international basis—is simply because the amount of liquidity is insufficient for world trade at the moment. Presumably the Chancellor of the Exchequer will in time get round to this. Eventually the Government will get round to the basic fact of life and realise that international liquidity and competitiveness regarding exports is the basis for any sound economy, irrespective of which party happens to be running the Government at the time.
What worries me is the blunt instrument which the Chancellor has used in an endeavour to reduce imports. This 15 per cent. surcharge applies, roughly, across the board, with the exception of raw materials, tobacco and a few other things. It is a blunt instrument. If the Government say that we are to modernise and get some up-to-date machinery, why should we penalise industry by imposing a 15 per cent. surcharge on some machines from abroad simply because they are not manufactured in this country? Hon. Members opposite may say that the machines should have been made in this country, and we accept that, but if we want a piece of machinery in order to modernise, can we wait?
I noticed that a few hon. Gentlemen opposite nodded their heads when I spoke of the increase in international liquidity. I think it deplorable that this blanket charge of 15 per cent. has caused such a stir, particularly in respect of the International Monetary Fund. One should pay tribute, in my opinion, to my right hon. Friend the Member for Barnet (Mr. Maudling) and his predecessors as Chancellors who were largely responsible for increasing international liquidity through the I.M.F. drawings and the Basle Agreement. It came as a shock to me that the I.M.F. should argue whether we had the drawing rights which we thought we had simply because the Government had imposed a 15 per cent. blanket charge.
Another criticism I have of the surcharge is that as an international trading nation we must always fulfil the pledges we give in any agreements we may sign. I am not proposing to mention all our trading partners or the countries with whom we trade. Let us take the case of our E.F.T.A. partners. Here we have a clear-cut agreement. I would not have thought it beyond the wit of the Chancellor of the Exchequer to have had some consultation with our E.F.T.A. partners. I would much rather the right hon. Gentleman had been a little more discriminatory in the imposition of the 15 per cent. charge. As I am sure hon. Members will agree, we must always avoid any action which may lead to reciprocal action on the part of our trading partners.
I think the Government have overplayed this crisis. The White Paper which was published with the announcement of the 15 per cent. surcharge referred to a deficit figure of £700 million to £800 million as being likely. We should remember that the balance of payment deficit goes on the calendar year and that we have already had ten-twelfths of that year. The last figure which I was able to obtain applied to the end of the second quarter and showed that our deficit was running at around £340 million. This included some of our overseas aid through exports for which we do not necessarily get paid. With our razor-edge economy we have to remember that we can at any time talk ourselves into a financial crisis. My greatest criticism of the Government is that they have exacerbated and exaggerated the balance of payments deficit. It was a difficulty but there was no need to exaggerate and to say that the deficit was something like £700 million or £800 million. My guess is that the amount will be very much less. It does not do very much good to the economy of the country to overstate the deficit.