A question was put to the Foreign Secretary to-day suggesting that negotiations might be opened up with Russia. Ever since this Government took office they have refused to open up negotiations, and if ever really practical negotiations were entered upon between Russia and this country I should advocate, as I am advocating now in regard to the French and Italian Debt, justice to this country before magnanimity to another country.

It is a pity—and I think everyone agrees with this—that at the time of the Armistice, and during the peace negotiations, there was not an all-round agreement for an all-round cancellation of these debts. America, of course, was the obstacle, but now that we have funded our Debt to America, unless the United States is prepared to annul that agreement, we are bound to make the best terms we possibly can with our own Continental debtors. No doubt in the course of this Debate the question will be raised of the difficulty of effecting transfers. No one knows better than the hon. Gentleman opposite (Sir F. Wise) that this question was most exhaustively considered, discussed and reported upon in the Dawes Report, and their conclusion is that up to a certain point, and within limits, these sums can be transferred without any injurious effect upon the exchange of that country or any dislocation of the trade of the receiving country. The Chancellor of the Exchequer will say, no doubt., he has done the best he could. It is no use him saying, and it is no use the French saying, and it is no use the Italians saying, they are unable to meet their obligations to a greater degree.

It will need a great effort to mobilise their economic resources, but it is high time the French particularly abandoned their inherent unwillingness to pay taxes. They have been presenting during the last few months a contemptible spectacle to the whole world, and the failure to tax themselves is bringing France to the verge of national bankruptcy. There may be certain temporary advantages, and one of the things that has been done is to wipe out about four-fifths of the French public debt, and in that process a large number of British investors have suffered very severely through French financial policy. I remember that M. Clementel, in the report to which I have referred, suggested a Dawes scheme for the treatment of Inter-Allied indebtedness. The crux of the Dawes scheme is the financial control of a country by its creditors, and if France wishes to avoid that unpleasant and humiliating experience she might secure the object of the Dawes scheme by her own effective control of her great resources. I said I desired that the purpose served by this Debate should be to strengthen the hands of the Chancellor of the Exchequer. The provisional arrangement made with the French Minister last year is, for the moment, so much waste paper. If the time comes when the French resume negotiations I hope the Chancellor of the Exchequer will not be bound altogether by the terms he made then. He would have sufficient justification for asking for their revision on terms which will do less injustice to this country. I began by saying this question was one of great importance to the taxpayers of the country. We have since the War made unparalleled sacrifices to maintain the fabric of our financial institutions. We have redeemed nearly £1,000,000,000 of our debt. We have maintained a far greater rate of taxation than that borne by any other of the Allies. I think, therefore, we are fully justified in asking that these debts should be funded upon much more advantageous terms from the point of view of this country than the Chancellor of the Exchequer has so far succeeded in doing.