asked the President of the Board of Trade why the export of vehicles in September, 1956, was the lowest for that month for six years; why car exports were 30 per cent. below the level of September, 1955, and those of commercial vehicles 28 per cent. lower than last year; and whether he will make a statement on the Government's plan to reverse this process.

The main causes of the decline in exports of motor vehicles this year have been import restrictions in some of the industry's principal export markets. More than two-thirds of the fall in September can be attributed to the Australian and New Zealand markets alone. In addition there has been intensive foreign competition in overseas markets generally. Nevertheless, in the first nine months of this year exports of commercial vehicles were only 1·8 per cent. lower than for the first nine months of 1955. The motor manufacturers are well aware of the need to increase their exports and of the willingness of the Board of Trade to give them as much help as possible.

The Minister says that motor manufacturers are aware of the need for increased production. Can he tell us something tangible about what his Department intends to do? Because of petrol rationing, many hon. Members, including myself, have constituents who are unemployed. There will not be so many cars wanted on the home market. Surely that is a wonderful opportunity for the right hon. Gentleman to assist those manufacturers to increase exports.

The hon. Gentleman will recognise that selling motor cars is a matter for the motor car industry and that no amount of Government assistance is a substitute for competitiveness in overseas markets.

asked the President of the Board of Trade what help is given by his Department to enable exporters to obtain publicity for their products abroad.

The facilities of the Overseas Information Services are freely available to all exporters who can provide the Board of Trade with material of news value. In addition, the Board and overseas posts will advise exporters about advertising agents and methods in particular markets.

If I understand my right hon. Friend correctly, his officers provide industries with information about opportunities for their products. Cannot those officers help industries on their own initiative, without waiting for the industries to ask them?

The Overseas Information Services disseminate material of news value. On the general question of advertising, we cannot, of course, advise manufacturers how to advertise their goods. That is their own choice. We can advise them about agents and about particular problems in particular markets.

asked the President of the Board of Trade under what agreements and contracts Her Majesty's Government is compelled to obtain the present supplies from the United States of America of cinematograph films and of tobacco for which dollars must be expended; and whether he will reduce the scale on which these imports are licensed.

asked the President of the Board of Trade what steps he is taking to reduce dollar expenditure on films and tobacco.

There is no compulsion upon British importers to buy American films. Moreover, a special limit is placed, in agreement with the American film companies, on the earnings from films which can be remitted to the United States of America. In the case of tobacco, manufacturers have already bought and paid for the American supplies they were permitted to buy from this year's crop. The question of imports from next year's crop does not arise until July, 1957.

While understanding that exports must provide the wherewithal to pay for the imports from any country, may I ask my right hon. Friend whether it would not be considerably helpful to our trade if we could get these not entirely vital materials from, say, Rhodesia, which can produce more, with easier terms of trade that relieve us of embarrassment for dollars?

As my hon. Friend knows, there has been a very large-scale substitution of American tobacco by Rhodesian tobacco since the war. I am perfectly prepared to consider whether that could be carried further. However, it does not arise immediately. This year's crop has already been bought.

Now that we are scraping the bottom of the barrel for dollars, what are the Government doing to see that dollars are not wasted on inessential goods or goods obtainable from non-dollar sources? I agree that we have commitments but, subject to those commitments, what else are the Government doing about the matter?

The Question relates to films and tobacco. In regard to films, there is an agreed limit as to the amount of dollars that can be transferred across exchanges. In respect of tobacco, there has been a large-scale substitution.

Will the right hon. Gentleman consider revising the film quota so as to allow more British films to be shown?

I do not think that a mere alteration in the quota would of itself ensure more British films being shown. First, they would have to be produced. That is the purpose of a Bill which is shortly to be introduced.

asked the President of the Board of Trade if, in view of the economic situation, and the possible increase in the cost of living, he will take steps now, to implement some of the recommendations of the Hodgson Committee, particularly weight fluctuations in packets and bottles, and contents of all goods sold in boxes, and so achieve some stability of prices.

No, Sir.

Is the President aware of how disappointed I am with that reply? Does he know that there is general disappointment at the hesitation of the Government to introduce the recommendations of the Hodgson Committee? Could he say when he is likely to introduce some of the recommendations?

Not this Session, but those recommendations have nothing to do with the stabilisation of prices.

Was not that Committee a very responsible Committee which did excellent work, and for the Government to ignore that work is not complimentary to those on the Committee?

Yes, the Committee has done a good job. The reason for this delay is not concerned with any question of not being complimentary to the Committee, which did very good work on complex and difficult problems; it is because there would not be time to introduce a major Bill of this character this Session.

asked the President of the Board of Trade the present policy on granting licences for shipments of military and para-military equipment to Middle Eastern States.

The United Nations Resolution of 2nd November calls upon member States to refrain from introducing military goods into the area of hostilities. We have complied with this recommendation. The export of arms and equipment is permitted to countries towards which we have treaty obligations and to other friendly States.

Whilst thanking the President for that reply, may I ask whether it would not be wise policy to stop shipping arms to any Middle East countries, at any rate until the situation has clarified? Can the right hon. Gentleman give an assurance that no arms are being shipped to countries whose Governments have declared hostility to the existence of Israel?

Perhaps the hon. Member would put that question to the Foreign Secretary.

asked the President of the Board of Trade what powers he still retains to impose price controls; and if he will use these powers to prevent profiteering from shortages, following the Suez crisis.

There is power to control the price of a small number of commodities under Defence Regulation 55AB. I do not expect any general shortages or profiteering in the field for which I am responsible.

Does that mean that the President is not going to use any price control powers at all? Is it not implied from the appeal of the Chancellor to businessmen that there is profiteering, or that there is going to be profiteering? Is it not quite clear from that statement that some price increases are not now justified and, therefore, that the President should take action to stop that happening?

The price control powers which I have are limited to a small number of commodities. As the hon. Member is aware, price control is operated on iron and steel scrap and in a few cases of that kind, but I do not intend to take wider powers.

Is the right hon. Gentleman not aware of statements made by a number of his hon. Friends yesterday that manufacturers and traders are now tending to put up prices because of the increase in distribution charges because of the oil tax and other reasons? In view view of the appeal of the Chancellor, to which my hon. Friend the Member for Newcastle-under-Lyme (Mr. Swingler) has drawn attention, does not the President think that the best way to stop the tendency to put up prices here, there and everywhere is to use price control?

One way to stop it will be for all of us not to exaggerate the increases of prices which have taken place or we can well create an atmosphere in which everybody will go in panic for increased prices. The movement has been quite small.

Would the right hon. Gentleman get his Department to watch very closely the price of oils other than hydrocarbon oils because at the moment those oils are being chalked up at prices which can get very high indeed without being noticed? Will he watch that?

Certainly, Sir.

asked the President of the Board of Trade what discussions he has had with the Iron and Steel Board on the construction of a new plate mill.

I am discussing steel plate production with the Iron and Steel Board and attention is being given to effecting an expansion of capacity. The Iron and Steel Board is considering some projects for additional plate capacity, but is not yet in a position to make an announcement.

In view of the time it will take to construct a new plate mill and the very largely increased demands there will be for plate for super-tankers, for the atomic energy programme and oil storage, does not the President think the time has come when we should introduce some method of allocation in accordance with priorities, if we are not to have very severe economic difficulties?

I do not think a large-scale allocation scheme would really help at present. What is important is that we should have new capacity and I am discussing that with the Iron and Steel Board, which will make an announcement when it is ready.

Is this new capacity proposed to be with an existing firm, or will it be under the powers which the Minister has to set it up under his Department, if he so wishes?

Perhaps the hon. Member will await an announcement by the Board.

asked the President of the Board of Trade what commodities, other than oil, are likely to be scarce or reduced in supply owing to the blocking of the Suez Canal and Middle East disturbance; to what extent this will involve increased prices of retail goods dependent on supplies of raw materials that must now be transported to this country by alternative routes.

Supplies of imported commodities, other than oil, are not likely to be seriously reduced, although there may be some delays in arrivals. The price of imported materials constitutes only a part of the final cost, and the rise in freight rates should not greatly affect retail price of manufactured goods.

Has the President taken any action to see that whatever increase there may be is not exaggerated by those who have control at some intervening point?

I am grateful to the hon. Member, and I am sure he is right in sayine that we should not exaggerate these things.

That is not the point at all.

asked the President of the Board of Trade what trade pacts or agreements existed between this country and Egypt and Middle-East Arab countries, respectively; to what extent these have been abrogated or renounced; and to what extent, in volume and value, our export trade to that area and our import trade, particularly in raw materials, has been affected.

The only trade agreement between Her Majesty's Government and the countries to which the hon. Member refers is the Anglo-Egyptian understanding of 1930 on most-favoured-nation treatment, which has not been abrogated or renounced. The rest of the Question does not, therefore, arise.

asked the President of the Board of Trade if he will make a statement about the future policy to be followed by Her Majesty's Government at world trade fairs.

No, Sir. The Exhibitions Advisory Committee, which, as I told the House on 31st October, has been reconstituted under the chairmanship of my right hon. Friend the Minister of State, is examining various aspects of policy on overseas trade fairs and I shall await its views before deciding on any changes that may be desirable.

Cannot the President ask the Committee to expedite its decision? Trade fairs will be starting early in the New Year, and unless we have a better policy than we have had in the past, we shall do as miserably as we have done since the present Government came into power.

We have broadly carried on the policy adopted by the right hon. Member when he was in power. I do not deny that there may be room for improvement. All I suggest is that we should await the views of this Committee before changing the policy.

asked the President of the Board of Trade what reply he has given to the representations by the New Zealand Government concerning the importation of meat from the Argentine.

We drew attention to the fact that New Zealand has now a much bigger share of our total meat imports, both by quantity and value, than before the war; and we said that we have no reason to expect any substantial change in the level of meat imports in the near future.

Is not the New Zealand Government disturbed because more and more imports are coming in? The President of the Board of Trade will recollect that the Australian Government made the same representations, with the ultimate bad results to our country which resulted in the new Agreement? The New Zealand Government will be taking similar steps. Cannot the right hon. Gentleman stop that now?

I am not sure what the right hon. Member has in mind, but the New Zealand share of the market, both in quantity and value, is larger than it was before the war. The Australian problem was quite a different one. It was based, not on meat, but on wheat, and the share of the market had declined, not increased.

If there is an improvement in trade with both those countries, that is due to bulk purchase and longterm trade agreements under the Labour Government. May I ask the President whether he does not expect the New Zealand Government to be as awkward in the future as the Australian Government have been in the past, because of lack of action on the part of Her Majesty's Government?

I would not accept that either of these two very friendly Commonwealth Governments have been in the least bit awkward in any way.

Is there any reason why we should not take as much as New Zealand is able to let us have up to the limit of our consumption?

As I said, we are taking very much more than we did before.

asked the President of the Board of Trade if, in view of the Manchester Court decision of 5th December in which his Department was concerned, and the further evidence supplied by the hon. Member for Coatbridge that moneylenders are defeating his regulations in respect of hire-purchase deposits, he will now take steps to secure compliance with the intention of his credit restriction policy.

I propose to lay before the House shortly Orders dealing with loans made by arrangement with the dealer for the payment of deposits and advance rentals.

asked the President of the Board of Trade if he will make a statement on his present policy regarding factory building in Development Areas.

The policy remains as it was at the time of the statement by my hon. and learned Friend the then Parliamentary Secretary on 5th June, when answering a similar Question by the right hon. Member for Huyton (Mr. H. Wilson).

Is the President aware that that statement caused a great deal of concern? Is he further aware that there is a general feeling in the Development Areas that there is an absolute standstill in Development Area policy at the moment? Would the President deny that?

I agree that there has been economy exercised in Government building in the Development Areas.

Will the right hon. Gentleman bear in mind that in the north-east Lancashire Development Area sites are available, labour is available, and all that is wanting is some factory building?

I will certainly bear in mind conditions in north-east Lancashire.

Can my right hon. Friend say how the percentage of unemployment compares with the rest of the country?

I think it is 1·5 per cent. in north-east Lancashire compared with just over 1 per cent. in other areas.

asked the President of the Board of Trade how many applications for the provision of new Government factories or extensions under the Distribution of Industry Act in the North-East Development Area have been granted in the past six months.

Two, Sir.

Is the Minister aware that this is quite inadequate? If there is a general slow-down in building, there is a particular need for development policy. We expect him to show greater interest in this matter and to promote and encourage more building activities in Development Areas.

At the same time, I think all forms of Government expenditure must be closely watched. [HON. MEMBERS: "Oh."] Certainly. All forms of Government expenditure need to be closely watched, and this is an expenditure which cannot altogether escape attention.

What is the policy with respect to those factories in Development Areas which are closed down due to the Government's credit policy, with work being withdrawn into the main factories of the companies concerned?

There is a fairly high demand for factories in the Development Areas, but if the hon. Member has a particular case in mind, I will certainly look at it.

asked the President of the Board of Trade by what percentage he estimates British output will be cut when oil supplies are reduced by 20 per cent. on 1st January.

The reduction in oil supplies by 20 per cent. from 1st January will apply only to gas/diesel oils. The cut on fuel oils will remain for the time being at 10 per cent. No precise estimate of the effect on industrial output of this further cut of gas/diesel oils is possible, but it is thought that the effect will not be very great.

Will the Minister tell the House how those firms which, for obvious reasons, are saving all the diesel oil possible, can cut their oil consumption by 20 per cent. without cutting their output and production?

There may be some cut in output, which will vary very much from firm to firm. I understand that a questionnaire has been sent out by the Ministry of Fuel and Power to the firms concerned, so that they will have an opportunity of stating the effect in each instance.

Are not the Government being far too complacent about the effects of their policy on industrial production? Is not this a parallel to the complacency of the Chancellor of the Exchequer in the economic debate five weeks ago, when he gave the impression that there was very little harm to our economy, whereas now we see day by day very serious harm? Will the right hon. Gentleman not get out of his head the idea that it is possible to cut the import of raw materials without a very serious effect on production?

I think we want to take a sensible position in this matter. We do not want to underestimate the problem which must arise if oil is short. At the same time, we do not want to slide into the much more dangerous opposite position of exaggerating all our difficulties, which would undoubtedly do grave harm to the economy.

asked the Chancellor of the Exchequer the number of Premium Bonds sold up to midnight, 1st December.

The number of £1 units sold up to the end of November was 46½ million.

Is my right hon. Friend satisfied with this very excellent result?

The Treasury is never satisfied, but we are very pleased.

Has the right hon. Gentleman seen the comment in most financial journals that a considerable part of those purchases were made by taxpayers in the Surtax class because they provide a reasonable inducement to them that they will do better out of this tax-free prize than with ordinary lending? Will the right hon. Gentleman say to what extent the Treasury estimates that these sales are mere diversions from other forms of saving and not a net increase in savings?

What gives me satisfaction is that these new Premium Bonds are proving popular with all classes of people and that the figure of savings remaining outstanding is higher at this moment than ever before.

asked the Chancellor of the Exchequer if Her Majesty's Government will institute a fund, out of blocked Egyptian assets, to provide for British subjects taking refuge in this country as a result of expulsion by the Egyptian Government.

I would refer my hon. Friend to the reply given to my hon. Friend the Member for Portsmouth, South (Sir J. Lucas) on 4th December and to the statement my right hon. Friend the Chancellor made in the course of his speech on 6th December.

asked the Chancellor of the Exchequer if he will be prepared to release the Egyptian dominated accounts in this country belonging to British subjects, normally resident in Egypt, who are now here as a result of the actions of the Egyptian Government, subject to the proviso that such sums shall only be spent or invested in the United Kingdom.

When these returned British subjects declare that they intend to live permanently in the United Kingdom or any country other than Egypt, their sterling assets will no longer be subject to the restrictions imposed on the accounts of residents of Egypt. Where they are not proposing to settle permanently outside Egypt, reasonable facilities for drawing on their sterling assets are allowed.

Does my hon. and learned Friend appreciate that at the moment some of these people are suffering critical difficulties? Will he not agree to waive that rule for the time being in order to allow them, at least temporarily, to have some of this money, which is their own, in order to start in business in this country?

I am not sure whether my hon. Friend appreciates that a British subject home from Egypt who is not prepared to declare that he intends to live permanently outside Egypt is nevertheless allowed to draw on his Egyptian sterling account at the rate of up to £100 a week and, in addition, to draw for miscellaneous purchases, such as the purchase of a house in this country in which to stay for the present.

Considering that they are innocent victims of this disaster, could not we send them to Jamaica for a holiday?

In order to make the position quite clear, will my hon. and learned Friend assure the House that Egyptian assets are in no case being paid over to the Egyptian Government at the present moment?

I think that is well known, but I am grateful to my hon. Friend for mentioning it.

asked the Chancellor of the Exchequer whether he would be prepared to consider a temporary reduction in the Purchase Tax on cars as a special measure to help the industry in its present difficulties.

No, Sir.

As the Financial Secretary himself said that the penalties which we have to bear are strictly limited and temporary, and as, furthermore, the Chancellor of the Exchequer has told us of his determination keep up industry, is it not fair to ask for something to be done for the motor car industry, which is suffering solely because of the policies of this Government?

I hope that the car manufacturers will take every opportunity of increasing their sales in markets which are not affected by the fuel shortage. The Export Credits Guarantee Department has been evolving new techniques specially designed to support aggressive sales campaigns and is ready to place all its facilities at the disposal of the manufacturers.

If the right hon. Gentleman's remarks do not seem to seep into the minds of the motor manufacturers and Coventry men are thrown out of work, will he be prepared to look at some alternative suggestion?

I am always ready to consider all suggestions, but I do not think that that contained in the Question is a good one.

asked the Chancellor of the Exchequer to what extent his Department's estimate of 1s. 5d. per gallon on the price of petrol increasing the cost of living by one-third of one point took into account the increases that will arise in distribution costs of milk, bread, coal, vegetables, and meat, the increase in the cost of bread, where this is produced by oil-fired stoves, and the increased rates of local borough councils.

asked the Chancellor of the Exchequer if he will state in detail how he has arrived at his calculation that the increased cost of petrol will cause an increase of less than one-third of a point in the cost-of-living index.

On 4th December my right hon. Friend gave an estimate that the increase in the duty on petrol and similar hydrocarbon oils by 1s. 0d. a gallon would increase the cost of living by less than one-third of a point. This took into account both the items in the index into which the cost of petrol and other dutiable oils enters ascertainably, that is, private motoring and travel by bus.

That was with reference to the Is. tax. The Minister will agree that there has been a further increase of 5d. and that almost every week this year the Government have come forward with new increases and said, "This will mean only a small increase in the cost of living." That is what they have said, whether it has concerned rents, prescriptions or petrol. Surely the Minister can give some idea of what the position will be in the next two or three months?

The Question relates to the estimate of one-third of one point in respect of the petrol duty. That one-third of one point is the estimate in relation to the duty, and the duty only; and that is the basis on which my right hon. Friend made his estimate of one-third of one point. Taking into account the other matters, it is increased to the neighbourhood of one-half of one point, as I think the hon. Member knows.

Is the Minister aware that I was present when the Chancellor made his amazing calculation. I regret that it was not possible for the Chancellor to see the pained expressions behind him. Nevertheless, the statement has been made. Can the Minister give an undertaking that if any firms make a "phoney" excuse of an increase in the price of petrol for raising prices substantially, the Government will take action against such unpatriotic firms?

I would say to the hon. Gentleman and to the House that the statistics show that the rise in the cost of living is very small, or relatively small, and includes both the increase in duty and the increase in the commercial price of petrol. I am sure that that is a consideration which will be borne in mind by all concerned.

Does the half of a point assume that none of the traders concerned will add more to the final price than the 1s. 5d. which is strictly justified?

It includes the 5d. increase in the commercial price for private motoring, and was based also on the hypothesis that all bus operators would raise their fares by the maximum allowed, so in that respect it is a pessimistic calculation.

But does it assume that none of the traders will add on more than the 1s. 5d. which is strictly justified?

It does not include any figure above that.

Does it include the 8d. a ton that has gone on coal today?

asked the Chancellor of the Exchequer what change took place in the total figure of sterling balances in November, 1956.

The figures are not yet available; but apart from that, it has been the practice of this and previous Governments to publish these figures only half-yearly in the White Papers on the balance of payments.

But whatever the practice may have been, does the hon. and learned Gentleman agree that a somewhat misleading picture may be derived from the publication of movements in the gold and dollar reserves in times such as the present? Might it not even be helpful to the Government and to the position of sterling to see what, if any, changes there have been in sterling balances at the same time as these devastating changes in the gold and dollar reserves?

The right hon. Gentleman is, of course, correct. There are considerations on both sides. After all, he, or his right hon. Friends, followed this practice when the Labour Government were in power. Sir Stafford Cripps expressly said, when asked about it in 1950, that he would not change the practice.

asked the Chancellor of the Exchequer the total loss, over the months August to November, of gold and dollars, net of the proceeds of the sale of Trinidad assets; and the proportion which these represent of the gold and dollar reserves at the beginning of that four-month period.

The figures are: 616 million dollars and 26 per cent. It is, of course, precisely because these are large totals that steps have been taken at home and abroad to strengthen our position.

But does not the hon. and learned Gentleman recall the very critical comments made by the Chancellor on 17th February about the fact that our gold and dollar reserves for the whole of 1955 fell by about 25 per cent.? Is he not aware that a fall of 26 per cent. in four months is extremely serious, and will not be covered merely by borrowing more money from other people?

I do not know about the last part of the right hon. Gentleman's supplementary question, but he will appreciate that the drawings and the standby from the International Monetary Fund are, in total, just about twice the figure of the losses of reserves in the last four months.

In view of the remarkably fine export figures for October and November, can my hon. and learned Friend say to what extent these losses of gold and dollars are attributable to speculative elements, and to what extent they may be attributable to trading deficits or surpluses.

I think that my right hon. Friend made it clear in his statement last week that they were not attributable to any defects in our trading position. My hon. Friend may have observed that that is confirmed by what Mr. Jacobssen is reported this morning as saying.

While imports were bound to be severely reduced in November by lack of shipping, as we were previously informed by the Government, is it not a fact that, in addition to the speculative element mentioned by the hon. Member for Kidderminster (Mr. Nabarro), there must have been a pretty substantial leakage of capital movements from the sterling area to the outside world? How far, in the view of the hon. and learned Member, is this due to the most regrettable weakening in the exchange control defences of the pound over the last two or three years.

I think that the right hon. Gentleman is now seeking an answer to which he is not entitled at this time.

asked the Chancellor of the Exchequer if he has now reached a decision on the recommendation of the Guillebaud Committee that hospital capital schemes of less than £100,000 should no longer require individual approval by the Treasury.

Yes, Sir. Hospital capital schemes costing less than £60,000 no longer require individual approval by the Treasury.

Is the Financial Secretary aware that the regional hospital boards will tender to the Chancellor their half-hearted thanks for his: having gone half-way to meeting this recommendation? Can he tell the House why it has not been possible to go the whole way to meeting this very modest recommendation in the Report?

I had hoped that the hon. Member, as a member of a regional hospital board, would have been wholehearted on this occasion. The fact is that £60.000 is double the previous limit of £30,000, which is the limit that already applies to most other civil and defence building paid for by the Exchequer.

asked the Chancellor of the Exchequer what changes he proposes to make in the Profits Tax, the Purchase Tax and the tobacco and beer duties in his next Budget.

I do not propose to anticipate my right hon. Friend's next Budget.

In that case, can the right hon. Gentleman tell us why Income Tax is to be singled out, and why we were given last week an indication of his right hon. Friend's intention about that, and not about other taxes? Will he please explain the logical distinction which his right hon. Friend made in his mind?

My right hon. Friend explained that the Income Tax was the traditional first weapon first used on these occasions. I know of the Socialist devotion to high taxation, but I should not have thought that the hon. Member would wish the Chancellor to increase all these taxes simultaneously.

Is the extraordinary reference made by the Chancellor to the Income Tax—marking a very great contrast to what the Lord Privy Seal did on the eve on the last Election—in any way connected with the Financial Secretary's statement last night, when, quite suddenly, he told us that there was not to be an Election in 1957? Are we to take it, therefore, that in 1957 there will be no question of following the Lord Privy Seal's example?

I have already said that I do not propose to anticipate my right hon. Friend's Budget, but I do not see why I should not anticipate General Election prospects.

In view of the fact that the Chancellor of the Exchequer can never anticipate his Budget statement, is not the asinine Question on the Order Paper typical of the oaflike Opposition opposite?

I can add nothing to the cogency of my hon. and gallant Friend's question.

Even if the Financial Secretary is unable to answer that question, can he, at least, give an assurance that, after this week, there will be no further Budget until April?

I am not proposing to anticipate anything, but the Financial Secretary has a personal interest in avoiding Budgets.

In view of what the Financial Secretary has said, and despite the fact that it clearly contradicts everything which the Lord Privy Seal did in his last Budget, can we have an assurance that it is clearly the Chancellor's intention to consider increasing the Income Tax before he considers any changes in the taxes which I have mentioned?

Certainly not.

My right hon. Friend the Chancellor indicated that he had reviewed the tax field. He made certain statements on Tuesday last week. I have nothing to add to them.

asked the Chancellor of the Exchequer whether he can now give further details of the Government's application to the International Monetary Fund.

Yes, Sir. Her Majesty's Government have applied to the International Monetary Fund for a drawing of 561·47 million United States dollars and a standby arrangement to draw currencies worth up to 738·53 million United States dollars. These requests were approved by the Executive Board of the Fund at its meeting in Washington yesterday afternoon.

Can the Economic Secretary confirm that if, as we hope, our gold and dollar position begins to improve in the near future, the first claim on our reserves will then be the repayment of these drawings before we can begin in any normal sense to build up our reserves again?

We have undertaken to repurchase the dollars obtained by the drawings within three years.

Is this not a very grave statement for the Government to have to make at this time? Does this not mean that the Government are throwing in one of our last lines of reserve to pay for the military expedition to Suez and is it not a fact that it was always envisaged that reserves as important as these might be needed in case of some worsening of world economic and financial conditions? Will the Government bear in mind what my hon. Friend has said, that they should make this a first priority of financial policy to re-establish these reserves in order that we can be fortified against any further difficulty which we may meet?

Yes, and we shall certainly hope to do better than our predecessors in this respect. In the six months following September, 1947, the Labour Government made four drawings on the fund to the total of 300 million dollars. A repayment to the fund of 124 million dollars was made in 1954, when the present Administration was in power.

Surely the hon. and learned Gentleman does not want to mislead the House? The present Government have borrowed not 300 million dollars but, in various forms, 1.300 million dollars. Will the hon. and learned Gentleman inform the House by how many hundreds of millions of dollars the reserves today are below the figures when we on this side of the House left office?

The right hon. Gentleman pools these amounts together as a borrowing, but he will appreciate that the drawing is 561 million dollars. The larger figure of 738 million dollars is not a borrowing as of now, but is merely a standby arrangement.

asked the Chancellor of the Exchequer if he will make a statement on the working of the new procedure for regulating the salaries of university teachers.

I understand that, after discussions between the Committee of the Vice-Chancellors and Principals and the Association of University Teachers, each of these bodies has met the University Grants Committee and given it a full statement of their views on the need for a review of academic salaries. My right hon. Friend now awaits a report from the University Grants Committee.

Is the right hon. Gentleman aware that it is operating very slowly indeed? Is he further aware that university teachers view with concern the increases in salaries obtained recently by civil servants and by teachers in schools and technical colleges, while their own salaries lag behind? Can he give any indication that some result will emerge before very long from these negotiations?

The hon. Gentleman knows that we do not interfere with the affairs of the University Grants Committee. The University Grants Committee will in due course, and as soon as it is in a position to do so, be submitting a report to the Chancellor of the Exchequer, and that is the time when the Chancellor of the Exchequer can give consideration to the matter.

Will the right hon. Gentleman give special consideration to salaries of professors of medicine and surgery? These compare badly with sums earned outside and tend to withdraw from professorships some of the best men in the service.

I realise that a number of different and sometimes conflicting views are held about the relative salaries earned by various people. I think we have got a fairly good procedure now, and in due course the Chancellor will be considering the report, when he receives it.

asked the Chancellor of the Exchequer what action he proposes to take to increase the volume of investment in manufacturing industries.

Fixed investment in private manufacturing industry has been rising quickly in the last two years. Last year the rate of increase was over one-quarter by value and about one-fifth by volume. In the first half of this year the same rate of increase was maintained. While this rapid growth of investment is to be welcomed, a degree of restraint on all forms of spending at home remains necessary in order to assist the balance of payments.

While thanking the hon. and learned Gentleman for that somewhat complacent answer, may I ask whether he is aware that the volume of investment in manufacturing industries is dropping behind that in Soviet Russia, the United States, Western Germany, Italy, and most of our competitors?

It is, of course, true that some countries are devoting more of their national output to investment than we are able to do, but I think that we have a good record, having regard to our defence commitments.

Is not the hon. and learned Gentleman aware that it has been the policy of the Chancellor throughout this year to try to cut down investment? Our national investment is now falling while Germany's is increasing sharply, with all that it means in the export markets. Will the hon. and learned Gentleman now consider introducing a system of control which will hold back the inessential investment in order vastly to expand the essential investment?

I know that the right hon. Gentleman has something of a King Charles' head about this, if I may so term it without disrespect, but the items which he has so much in mind really loom far less largely in this matter than he would like the House to believe.

Does the hon. and learned Gentleman's original Answer mean that the Government now want investment in manufacturing industries to go up or down?

The rate of investment in the manufacturing industries is holding pretty steady. That does not mean that the pattern of it is necessarily steady because, as the hon. Gentleman knows, as a result of the measures taken, investment tends to improve in that sector of manufacturing industries which particularly contribute to exports and the balance of payments.

Could the Economic Secretary answer the very simple question put to him? Do the Government want to see investment go up or down?

Yes or no?

We hope that it will continue to go up, but we want the upward trend to be without prejudice to the balance of payments position of this country.

asked the Chancellor of the Exchequer if he will reconsider the decision to claim a waiver of the annual instalment of interest on the loan from the Government of the United States of America, payable on 31st December, 1956, in view of the effect that its announcement has had on foreign confidence in sterling and also the necessity for its debate in Congress.

No, Sir. I see no reason why an application for a waiver of the annual interest on the United States loans of December, 1945, made in accordance with the intention of the Loan Agreement, should have on adverse effect on foreign confidence in sterling. Indeed, I am sure that the undertaking by the United States Administration to put the matter to Congress with a favourable recommendation has had a helpful effect.

Is the hon. and learned Gentleman aware that the forward premiums have moved steadily against sterling ever since his right hon. Friend made that announcement?

The official rate for sterling has held pretty steady in the last week since the statement was made.

Will my hon. and learned Friend agree that one of the chief reasons at the moment for lack of confidence abroad in sterling is the fear, which is of course, unfounded, that we might have the party opposite in power?

Can the hon. and learned Gentleman say what the legal position would be if the United States Congress do not accept this request before 31st December? Should we be formally in default or not?

No, Sir. My right hon. Friend made it clear that we are proposing to pay the amount of interest due, on the assumption that there is no waiver, into a special account to stress the fact that in no circumstances will this country default on its obligations.

Shall we be paying it into an account in the ownership of the American Government?

My right hon. Friend made it clear that the question of the machinery for the payment into a special account would be gone into in consultation with the United States Government.

asked the Secretary to the Treasury if he is aware that of the 1,960 pictures in the National Gallery only 855 were on exhibition on 26th July last, because there was not enough space to exhibit the other 1,105; if he will now state whether space has since been found to exhibit the latter; and what are his plans for relieving the National Gallery of this problem and for enabling the public to see all the pictures there that were acquired for the purpose of public exhibition.

Since 26th July the reopening of three more exhibition rooms has made it possible to hang a further 105 pictures in the National Gallery. Therefore, 960 pictures are now on exhibition in the Gallery, and a further 150 are loaned for exhibition elsewhere.

Does the Minister realise that both he and the Trustees are guilty of a serious breach of trust in not hanging the pictures which are entrusted to them for public exhibition, when there are other galleries ready and willing to do so? Will he take steps to see that some of the pictures are sent to appropriate galleries, for instance the Lane pictures to the Dublin Art Gallery?

I suspected that the Lane pictures were in the hon. and learned Gentleman's mind, but I detect no mention of them in his original Question.

asked the Minister of Housing and Local Government for how many local authority districts a list of buildings of special architectural or historic interest has still to be issued; of these, how many have still to be surveyed; and when it is expected the work will be completed throughout the country.

Out of 1,480 local authorities areas, 1,071 have been surveyed. Lists, including interim lists, have been issued in respect of 1,177 areas. I cannot forecast when this work will be completed.

While thanking the Minister for his Answer, may I ask him whether he would agree that, as so much of the work has already been done, it really is time it was completed? Will he give what encouragement he possibly can to see that it is expedited?

Yes, within reason; but there is, of course, a fearful amount of work involved in listing, and it does inevitably take time.

asked the Minister of Housing and Local Government whether he will introduce legislation to amend Section 8 (1) of the Rating and Valuation (Miscellaneous Provisions) Act, 1955, so as to permit exemption from rates of men's institutes, many of which are now in danger of closing down because of heavy increased rate burden.

My right hon. Friend has no legislation in mind on this point at present.

Will the Parliamentary Secretary bear in mind that, whilst the great public schools can be granted this concession of local authorities waiving rates, since I tabled this Question a men's institute in a small village not far from my home has had to close; and will he ask his right hon. Friend to reconsider this decision?

Section 8 of the 1955 Act does provide that non-profit-making organisations which are concerned with the advancement of religion, education or social welfare may qualify for relief. It is not for my right hon. Friend to decide whether any particular men's institute is covered by that Section or not.

asked the Minister of Housing and Local Government what proposals he has for the provision of more residential accommodation in central London; and whether, in view of the housing need and the heavy demands on transport facilities, he will refuse his consent to any further business and commercial building in the central area.

It was in order to reduce congestion that I modified the County of London Development Plan so as to increase the area allocated for residential use and to restrain the spread of commerce in the central areas. Since then I have missed no opportunity of stressing the importance of these questions. I am hoping shortly to receive from the London County Council and the City Corporation proposals for further measures to relieve congestion.

Whilst appreciating the steps which the Minister has already taken, may I ask him whether he would agree that there are indications that office building in central London is already excessive, as one can see from the number of advertisements about office space to let in many of these new, and older, office buildings? Is he not prepared to answer the specific point of my Question, as to whether he will definitely refuse his consent to any further business or commercial building, at least for the time being?

It is not so easy. It really would not be realistic to put a ban on all further commercial building in what is, after all, the principal commercial centre of this country; and, apart from whether it would be wise to do so, the compensation involved would run into fantastic figures. That must be borne in mind; but I am doing what I can to keep additional commercial building within bounds.

asked the Minister of Housing and Local Government whether he is now prepared to give permission for the erection of a rolling mill by Messrs. Joseph Gillott & Sons, Sheffield, at Butterthwaite.

My right hon. Friend hopes to give his decision this month.

asked the Minister of Housing and Local Government how many local authorities have notified him of their intention to discontinue building dwelling-houses.

I would refer the hon. Member to the Answer given to the hon. Member for Walthamstow, West (Mr. Redhead) on 4th December.

Is the Minister aware that it is reported that 300 local authorities are discontinuing building houses because of the abolition of the subsidy and the increase in the Bank Rate, and does he not agree that this is a retrograde step in a great social service? What is he doing to stop this step backwards?

I do not know about "this step backwards". First, I have asked all local authorities to let me have their estimate of the number of tenders which they are proposing to let for the erection of houses during the current financial year. As soon as the returns are complete, I shall publish them; but I think it will be found that, while there has been a switch from general needs house building to slum clearance, there is no evidence of any sharp reduction in the overall housing plans of local authorities.

Does the right hon. Gentleman consider it right to make a second cut in the housing subsidies when he does not yet know the result of the first one?

I believe the hon. and learned Gentleman will have an opportunity of expounding his views on that subject on Thursday.

asked the Prime Minister whether, in view of the need for national unity, he will take the necessary action to prevent controversial legislation being introduced and take such action as may be necessary to suspend further progress with the Rent Bill, and take no further steps to impose the prescription charges or take any other action which will increase the cost of living.

I have been asked to reply.

Is the right hon. Gentleman not aware that the Chancellor made an appeal only last week to the trade unions not to go forward for wage increases? In view of the fact that the trade unions have rightly condemned these suggested legislative Measures, which undoubtedly will push up the cost of living, should not the Minister, if he wants to get the co-operation and good will of the trade unions, meet them and discuss with them the possibility of implementing the suggestion contained in the Question?

It is very important indeed for the Government that we should work with the trade unions. The reason for the Rent Bill has been explained by my right hon. Friend the Minister of Housing and Local Government, and it will, we believe, have a good effect upon the economy, quite apart from the effect which it will have on the demand on housing. The question of the prescription charges, to which reference is made in the Question, arises because my right hon. Friend was obliged to economise in Government expenditure. There are, therefore, reasons for both these Measures, which we believe are important.

In view of the right hon. Gentleman's reply, may I ask whether it is intended by the Government that they should have formal consultations with the Trades Union Congress on the present economic situation, and, if so, whether it would not be wise, pending those consultations, for the Government to keep an open mind on this question?

I cannot go back on the Answer I have given on these questions, but I have said before, during the Prime Minister's absence, that we do attach importance to the contacts which we already have with the Trades Union Congress. In particular, my right hon. Friend the Chancellor of the Exchequer will be glad to maintain contact with the Economic Committee, and we have also the committees of the Government upon which the trade unions are represented. We value these contacts and, if there is the slightest desire for an early meeting, then it will certainly be met.

asked the Prime Minister if he will now propose a meeting of heads of Governments of the great Powers for the purpose of discussing the immediate limitation and eventual abolition of hydrogen bomb tests, and the organisation of an international embargo on arms supplies to the Middle East, pending the discovery of a lasting settlement of Middle Eastern problems.

I have been asked to reply.

Is it not now six months since the Prime Minister undertook to take the initiative on the matter of hydrogen bomb tests at an appropriate time? Was it not in July that the Prime Minister gave that undertaking, and could not the acting Prime Minister now say when the appropriate time is likely to be reached? Further, could not this question be well combined with an initiative to try to reduce tension in the Middle East by an arms embargo on the part of the great Powers?

It is true that this has taken some time. The reason it has done so is that it is very difficult to make progress with the matter. All I can do is to assure the hon. Member and the House that this will be one of the subjects which I shall discuss with my right hon. Friend on his return.