COMMONS DEBATE SOUGHT

Press, Volume LXXXIII, Issue 25248, 29 July 1947, Page 7

COMMONS DEBATE SOUGHT

Economic State Of Britain

EXPIRY OF LOANS

(Special Correspondent N.ZJ»A.) (Rec. 7 pjn.) LONDON, July 28. The Opposition intends to press for a two days’ debate on the economic state of the nation before Parliament rises on August 8. The Conservatives are also discussing whether they will make this an occasion to move a vote of censure on the Government, but in any case Mr R. A. Eden, who will be. the chief Opposition will ask the Government to state unequivocally whether it expects a breakdown in Britain’s economy when the dollar loan runs out.

Misgivings are not confined to the Opposition. Labour members also show acute awareness of the hazards of the country’s present position and are likely to welcome an opportunity for full discussion.

Article IX of the American loan agreement is certain to come under fire before Parliament adjourns. Seven Conservative members have already tabled a motion asking the Government to request the United States to release Britain from her obligations under this article, “as they prevent us from expanding Imperial trade.” CArticle IX of the loan agreement says: “If either the United States or the United Kingdom Government imposes or maintains quantitative import restrictions, they shall be administered on a basis which does not discriminate against imports from the other country.” This general rule does not -apply <a) where it would prevent the restricting country from using inconvertible currencies accumulated up to December 31, 1946; (b) where there is “special necessity” to assist some other country whose economy has been disrupted by war; (c) where the import restrictions are equivalent to any exchange restrictions authorised by the Bretton Woods agreement.] Realisation that although Britain is forced by the hard currency shortage to reduce her dollar urchases, she cannot go to her own dominions and colonies to redress the balance, has focused attention upon Article IX, which threatens to become the centre of angry controversy. Opponents of the American loan, who warned the Government that this would be the result of signing the agreement, are naturally ready to remind the Government that their warnings were disregarded.

“Great Unemployment and Hardship” Lord Brand, until recently financial adviser to the Treasury in Washington, when he spoke on the Finance Bill in the House of Lords, predicted that great unemployment and hardship of all kindfc would face Britain when the loans ran out, and that the present Budget surplus would then disappear “like snow upon the desert’s dusty face.” So far the Government has had nothing to add to Mr Herbert Morrison’s statement that Britain was relying upon the Marshall plan for assistance when the present American and Canadian loans were exhausted. Both Opposition members and many Government members are anxious to obtain an indication of what steps it is proposed to take to meet the crisis if the Marshall plan fails or does not materialise in time. In spite of American reassurances, doubts whether the Marshall plan will ever survive the opposition in Congress are growing, and with them uncertainty about the whole of Britain’s economic future.

Reports that exploratory discussions with the sterling Dominions are already taking place about joint Commonwealth action are confirmed, though the Commonwealth Relations Office is not at present disposed to go into details.