You may remember that, when I reported to the Government on the Bretton Woods proposals , I was, on balance, in favour of their acceptance by Australia. That was on the assumption as stated in paragraphs 41 and 62 of my report (paragraphs 22 and 43, pages 6 and 7 of the printed documents) that the International Monetary Fund would not prevent us from imposing import restrictions to correct balance of payments difficulties.
I notice, however, that the latest United States proposals on commercial policy contain the following provision: 'Members may use exchange restrictions or quantitative restrictions to limit imports temporarily, during any period in which the International Monetary Fund authorises such action to meet balance of payments difficulties.' Although a different view seems to be taken in the Dominions Office Circular Cablegram D1675  of 11th September, 1945, this provision seems to me to mean that the International Monetary Fund would be given authority not only to decide on the facts whether or not balance of payments difficulties had arisen but also in its discretion to authorise, or refrain from authorising members to make use of quantitative restrictions to limit imports.
Although part of the commercial policy proposals, this makes a vital difference to the International Monetary Fund and would seriously affect my judgment on the wisdom of Australia, from a technical angle, accepting the Bretton Woods agreements.
I realise that, in the course of discussions, this particular provision may be altered. I feel, however, that I should draw your attention to the matter because it raises doubt as to whether a final judgment can be made on the technical aspects of the Bretton Woods agreements before we have all the plans for international economic co-operation before us.
L. G. MELVILLE