En the months before the economic miracle I thought on a number of occasions about the import deposits scheme as something that might exercise some sort of constraint on the rise in imports which was alarming many of us. In those times used to put down Questions, a habit which I have given up because of its futility. On two occasions I asked that a survey be published of the assessment of the effectiveness of the import deposit scheme. As the Chancellor turned me down, I thought that I would go to the source of all economic inspiration, at that time the Department of Economic Affairs.
In July, 1968, I asked whether a survey could be published of the operation of the import deposits scheme, and I received the usual polite but terse reply, "No, Sir". Being a loyal party Member of Parliament, I went round to my con- stituency during the Recess saying that an import deposits scheme had nothing to recommend it. When we returned to the House I discovered that we had in operation an import deposits scheme, which I found, not for the first time, slightly disconcerting.
I always thought that this was a slightly better type of approach, if one were trying to restrain imports than, for example, import controls. My interest in it grew when, following a publication in February, 1968, of the National Institute Bulletin which advocated import controls I asked one of the people who wrote the survey whether he had paid any regard to the possibility of an import deposits scheme. He replied, "Actually, we do not know very much about it, but we have asked the Italians to translate some of their documentation so that we can have a look at it".
I was not altogether put off, but I have never really been attracted to the import deposits scheme, because I felt that it would have an effective impact on the balance of payments. Its attraction for me has always been that, unlike import controls, it has this sort of deflationary side effect. I accept the figures given by my hon. Friend about the direct effect of import controls on the balance of payments, but I think that he is a bit optimistic about the addition to reserves because foreigners will put down the import deposit for importers in this country. They might have done that when they felt—perhaps they believe politicians in this country rather more than we do —that it was going to be of an essentially temporary kind. If they feel that it is something that will be with us for a considerable time, their willingness to put down the deposits might decrease somewhat.