Early Snap Election In U.K. Thought Possible

Press, Volume CIII, Issue 30630, 22 December 1964, Page 15

Early Snap Election In U.K. Thought Possible

(N.Z. Pres, Assn.—Copyright?

LONDON, Dec. 21.

The British Prime Minister Mr Wilson, was believed to be seriously re-examining the case for a snap election early in 1965 because of the latest reports of continued crisis in finance, the “Observer” said yesterday.

The newspaper’s political correspondent, Nora Beloff, said last week’s events in the financial markets had brought fears that major investors might hold back, producing a damaging recession. This would bring widespread unemployment, in spite of the Government’s commitment to expansion. At the same time it was thought that an increased Labour majority—with better prospects of a four of fiveyear term in office—would reduce the temptation in some financial circles to speculate against the £.

Government leaders were bewildered by the crisis of confidence and the new flutter of devaluation rumours which they think centre on London.

They suspected that the crisis mood had been consciously encouraged by conservative publications hoping to demonstrate that Labour was incapable of governing, Beloff said. One senior civil servant who accompanied Mr Wilson to Washington had said the choice facing the Government was: devaluation or an early election.

The “Observer” story said Mr Wilson was determined to avert devaluation, so preparations must therefore be made for the alternative.

But a snap election would take place in February or

March only if public opinion polls showed Labour with a wide margin of popularity, and if this was confirmed in forthcoming by-elections.

“Lower” Morale

In a separate article in the “Observer,” a financial correspondent said morale in the financial markets seemed lower now than at any time since the election. The stock market was drifting lower for lack of buyers and the £ showed no real sign of sustained recovery. Almost to a man, financial circles believed the Government had been inept in tacking the nation’s economic crisis.

The “Sunday Times” correspondent, William ReesMogg rejected the possibility of devaluation, describing it as a “dangerous myth.” He said another dangerous myth was that the new

Government was an exceptionally bad one from a business point of view. It was an administration under which businessmen would have ample opportunities to conduct business successfully and to make money, if they would only let themselves.

Rees-Mogg said the city’s financial circles neither understood, nor were understood by the new Goverment They must have trust in each other to rebuild national confidence. Call To End "Feud”

The “Sunday Telegraph” city editor, Kenneth Fleet, also called for a halt to the “feud” between financial circles and the Government.

“The conflicting political and economic philosophies of capitalism and socialism can never be reconciled, but in the present national economic crisis, it is vital that mounting bitterness and gall is checked and persistent denigration stopped,” Fleet said.

Britain had to steer its way successfully between the forbidding rocks of recession on one side, and sterling devaluation on the other. “Unless a different and more harmonious spirit inspires both the men on the bridge and those in the engine room, we shall fail,” he said.