§ 17. Mr. Barnett
asked the Chancellor of the Exchequer if he will make a statement on the current trend of bank lending.
§ Mr. Roy Jenkins
Restricted lending by the London clearing banks rose slightly, after seasonal adjustment, in January and February; this rise followed a considerably larger fall in the preceding two months. Other groups of banks showed little change.
§ Mr. Barnett
Is it not time that we at least brought up to date the arbitrary figure fixed in November, 1967? Will my right hen. Friend consider some relaxation for small manufacturing companies?
§ Mr. Jenkins
It is very difficult to make selective relaxations. Money supply is growing somewhat owing to the inflow of foreign funds. As I have said, I keep all these matters under review.
§ Mr. Alison
Does the right hon. Gentleman appreciate that the substantial depreciation in the value of the currency since November, 1967, has had the effect of reducing the real level of the ceiling he put on bank lending to as little as 90 per cent. of the November, 1967, level and that this is both undesirable and unintentional?
§ Mr. Jenkins
The banks are somewhat above their ceiling, about 3¼ per cent. above at present. That is on restricted lending. There is also unrestricted lending which means that bank lending to industry as a whole has increased substantially during this period.