I think that the hon. Gentleman must see this in proportion. What it amounts to is that, during the course of the next tax quarter, about £300 million would normally be repaid, but some allowance has to be made for part of this to be financed by credit from overseas. If something like one-third of this is being financed from overseas, it is a flow which is not going back to industry of four-fifths of £200 million. Having regard to the liquidity position of companies, there is no reason at present to suppose that this will have an adverse effect on the industrial investment plans which are in evidence. So that, as I say, the balance of risk is against relaxation and in favour of keeping credit on a tight rein.
May I come now to my second main reason for renewing the scheme; the effect on the reserves. I can deal with this quite briefly. Our best estimates, as I have just mentioned to the hon. Member for Wycombe (Mr. John Hall), and as I revealed in a Written Answer some time ago, are that 30 to 40 per cent. of the deposits have been effectively financed from abroad, either by loans or by credit to importers from foreign suppliers. This very useful benefit to the reserves is, of course, purely temporary, though it provided help at a time when it was sorely needed.
I suggest to the House that, from this point of view, the renewal of the scheme is essentially a matter of common sense. It is true that we have had an excellent surplus so far this year, but our recovery is still very recent, and I am sure that everyone in the House will realise the need for this happy state of affairs to be more firmly established for a longer period before we can afford to take any avoidable measures that will weaken the reserves.
It is clearly, therefore, a matter of common sense to avoid at this particular time, in the next half-year, a monthly outflow from the reserves of £30 to £40 million which this foreign credit has represented. By means of the Bill it will be possible to phase out these payments more gradually over a longer period than the next six months.