Part of Bill Presented – in the House of Commons at 12:00 am on 3rd March 1965.

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Photo of Mr Reginald Paget Mr Reginald Paget , Northampton 12:00 am, 3rd March 1965

I was dealing with the Pacific Islands. The Americans still have bases in the Philippines. I was referring to going to Indonesia, Australia and so on through the Pacific.

There may be something to be said for this Conservative foreign policy, but, on balance, I would be against it. However, I think that there is something to be said for it if only because it satisfies our great American ally—and, unlike some of my hon. Friends, I consider that an important thing to do.

What I cannot understand the Government doing is, on the one hand, accepting Conservative foreign policy and defence commitments and, on the other, accepting their economic policies as a means of paying for them. I should have thought that one thing which 13 years of Tory rule had established was that the strain on our balance of payments in an uncontrolled economy got us into one balance of payments crisis after another and left us no chance whatever of developing investments sufficient to provide a 4 per cent. increase. or anything like it, in the national product. I am not for a moment saying that we are not a strong enough country to carry this defence policy should we decide that it was necessary, but we would have to be in a position then in which it was possible for us to control our priorities. General de Gaulle has been able to have an agrandising foreign policy for France, but look at the control he has over his economy. Not only is one-third of France's productive power nationalised and within his complete control but he depreciated his currency to the point which he found suitable to his economy, and he controls it. He controls his investment, both in the property market and in the money market. He even controls prices. That is a dirigiste economy. France also has a conscript system. Within that sort of control one can choose to allocate such a level as this to defence. Within our free system it is manifestly unavailable.

We put it beyond our power to have anything like a de Gaullist policy or de Gaullist controls the moment we said that sterling should be a first priority, because at that point we put ourselves in the hands of the bankers. We went to them. It is no use saying that bank loans are without strings. They are always subject to strings. The borrower's policy has to be such as the bankers deem sound before they are prepared to renew the loan. I do not think any banker would have any objection to the nationalisation of steel. Bankers have been accustomed to nationalised steel, unnationalised steel and semi-nationalised steel. They know that it does not make any difference, that it is irrelevant. It is a bit of nonsense to which they will not object. We have already experienced their reaction, however, to a policy of increased pensions. As to low interest rates, the sort of interest rates which will enable young working-class couples to buy their own houses as we promised them, and the substantial transfer of purchasing power from those who own to those who earn, these are just not acceptable to bankers.