INFLATION DANGER NEARLY GONE

Chronicle (Levin), 17 June 1946, Page 5

INFLATION DANGER NEARLY GONE

^ SATISFACTORY REPORT BY CHANCELLOR Received Sundav, 7.15 p.m. LONDON, .Tune 14. Judging by the yardstick of Ihe rate at which the Government can borrow, the national credit has never been higher, said the Chancellor of the Ex- : ehequer (Dr. Hugli Dalton) in opening the debate on the Government 's finance and budgetary poliey at tlie Labour Party Conference. The Government, to avoid inflation 07i the one hand and defiation on the other, was endeavouring to keep pro-; ductiun and piircliasiiig power closeiy related. Therefore he had deliborately gone slow in regard to tax rednc lions and the release of post-war credits, because lie was not going to be responsible for landing* tlie country in an inilationary spiral. "Now we have reached the point where the production of home goods is rapidly increasing and the fear of inflation is diminishmg, ' ' he added. "The danger of inflation is neariy — well, largely — passed away, but we must continue to show caution in handling public finance and insist on National Savings." He tidiled tliat, if tlie savings targetof £520, 000, 000 was not reached t.liis year, he would have to go slower still wit.li future taxation and the release of jiost-war credits. Replving to a resolution eriticising " ovor-generous " compensation of the Bank of England shareholdurs, and demanding tliat the compensation in future cases of nationalisal ion should bo the minimum possible, I)r. Dalton said: "We got a very good bargain from the Bank of England. Wliat. we have takou over is worth a great 'deal more than the priee paid." i Because tlie Bank of England was a1 special case, the shareholders had been treated on a more generous basis than would be Jikelv in future cases of nationalisation. A big point was that the Government, in nationalising the Bank of England, had talcen into safe keeping a national keypoint in all future liancial plans. Dr. Dalton said the Budget deficit this financial year would be reduced to only £726, 000, 001), which, without. terminal itcnis, would amount to only £300,000,00. "I say, 'Don't be slushy-minded about finance. Y'ou must recognise that, because. we have a great social programme, taxation for the next year or two cannut fall as fast as if we were lonservatives and liad no social programme'." ° Dr. Dalton ivas repeatedly cheered when he ended his speech and received one of the warmest ovations of Ihe conference. The resolution eriticising "over-gen-crous" compensation of the Bank of England shareholders was defeated by ari overwhelming majority on a show of hands. I After the conference had debated housing and the conditions of the colon- . ial peoples, Professor Laski, tlie. act.ing- ■ chairman, wound. up tlie eonferene.o by referring to the- publicitv given to him at tlie time of the general elcction. Ile irrmicrtllv ■'th-anke.d journalists for the attention given to his aetivities. "Never in the history of mankind have so many followed just one; the skeleton , now goes back into tlie cupboard," he said. j The conference coneluded with the| singing of the "Internationale" and Ihe " Red Flag. "