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United Kingdom And Newfoundland (Financial Relations)

Volume 437: debated on Tuesday 13 May 1947

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With your permission, Mr. Speaker, I should like to make a statement about the recent discussions with the Delegation from the Newfoundland National Convention. As hon. Members will be aware, a National Convention, elected by the people of Newfoundland, has been meeting in the island since last September. The Convention was constituted to consider the financial and economic situation of the island and, in the light of this, to make recommendations to His Majesty's Government in the United Kingdom as to the possible forms of future government to be put before the people of Newfoundland at a National Referendum at which they would vote for the form they preferred.

At the end of February the Convention passed a Resolution asking the United Kingdom Government to receive a delegation from the Convention to make inquiries as to the financial and fiscal relationship between the United Kingdom and Newfoundland which might be expected in the event of the people of Newfoundland deciding upon either continuation of commission Government, or restoration of responsible Government, or some other form of Government. His Majesty's Government readily agreed to this proposal and a delegation consisting of the Chairman and six other members of the Convention recently came to London.

Three meetings have been held with the Delegation, at which my noble Friend the Secretary of State for Dominion Affairs has answered specific questions which had been put to him. He was accompanied at these meetings by the Governor of Newfoundland (Sir Gordon Macdonald) and the Commissioner for Justice and Defence (Mr. A. J. Walsh). He indicated to the Delegation that it is the desire of the United Kingdom Government that the same close and friendly relationships should exist between the two countries as have always existed. On the financial side it was explained to the Delegation that it would always be our desire to help Newfoundland within our means; but my noble Friend thought it right to make clear, as was explained in this House on 11th December, 1945, that the special difficulties of our financial position must preclude us from undertaking commitments beyond our power. Hon. Members are well aware of the immense problems which beset us today in the financial field, which indeed are greater than was expected at the time when that statement was made.

My noble Friend was therefore unable to hold out any hope, in response to a direct enquiry by the Delegation, that the United Kingdom Government could consider taking over from Newfoundland liability for the public loan of about £17,800,000, which the United Kingdom Government guaranteed in connection with the establishment of the Commission of Government in 1934. We shall, of course, continue our guarantee and he indicated that we are prepared to proceed, in agreement with the Newfoundland Government, with a conversion operation at the earliest possible date which would reduce the interest payments from the Newfoundland Exchequer. Moreover, in present financial circumstances, the Delegation were informed that the United Kingdom Government would not give such firm assurances as they sought that we should continue to purchase from Newfoundland large quantities of such commodities as frozen fish and iron ore. We recognise the importance of the industries concerned to the Island's economy and I assured them that we shall always strive to do our best to assist, but it must be remembered that Newfoundland has a dollar currency and our measure of assistance must depend upon our general dollar position.

I need not trouble hon. Members with further details of the meetings. Nearly all the questions raised by the Delegation had in fact been under careful consideration for some time, having already been raised by the Commission of Government. As to the more general financial questions of the future, my noble Friend told the Delegation that, if the people of Newfoundland at their Referendum decided in favour of the continuation of Commission Government for a further period, the United Kingdom 'Government would continue to be responsible for Newfoundland's financial stability. If, on the other hand, the people decided for Responsible Government, this would mean that full responsibility for Newfoundland's finances would rest with the Newfoundland Government and people, and that the responsibilities undertaken by the United Kingdom Government in 1934 would cease.

I am sure that the talks which we have had with the Delegates have been useful and we hope that the people of Newfoundland will, at the forthcoming referendum, choose the form of Government best suited to the interests of their country.

Has the hon. Gentleman's attention been called to a statement which appeared in this morning's Press by one of the members of the Delegation complaining of the treatment that they received here, and saying that, if the Secretary of State for the Dominions wanted to make enemies of all the people of Newfoundland, he had gone the best way about it? Could the hon. Gentleman assure the House that while recognising, as we all do, the practical limits of any financial assistance we give, the Government 'will do everything they can within those limits to assist Newfoundland along the road that they want to choose for themselves?

The answer to the latter part of the question is, Yes. With regard to the other part of the question, there were six delegates, as I have said, and when there are six representatives from different sources it is hardly to be expected that you will get a unanimous view. However, I can give the assurance to the right hon. Gentleman that the majority of the delegates were very happy, and expressed themselves as such to the Secretary of State for Dominion Affairs.