British Budget Surplus Is Biggest In History

Chronicle (Levin), 3 April 1948, Page 5

British Budget Surplus Is Biggest In History

. LONDON, April 2. Tlie surplus of £635,000,000 disclosed with the closing of this year's- accounts, is by far the largest in British" finan-•-ial "history. The nearest approach to it was in 1920 when the surplus was ' just over £230,500,000. In lioth cases the surplus was largely due to exteusive saies of wnr equipment. Eleven days agO the surplus stood at over £.SOO,000,()()0; but heavv payments during the linal week of the year reduced the ligure by £145,000,000. This ineluded a repaymentf of £110,000,000 to the Argentine Government for meat supplies during the. coniing year. Mr. Dalton 's .1 947-48 Budget estimated the year's surplus at £269,000, 000 and although this was inereased to £318,000,000 in tlie supplenientary Budget produeed last Noveinber, even this estirfiate has been doubled. •ft is not only due ta substantiai increases in revenue but also to a decrease of £25(5,000 in expenditure com pared with the estimates made by Mr. Dalton at the beginning of the linancial year. The largest Lnereases in revenue were in Income tax whieh brought in £33,495,000 more than anticipated. customs £17,036,000, surtax £91,220,000, ext-ise £66,200,000, - profits and exc'ess pro/its tax £82,000,000. On the expenditure side defenee services spent £45,000,000 less than expected. During the year, chiefly as the result of overseas borrowing, the Govefnment was able to reduce tlie floating debt by £412,700,000. The Financial Tinies comments that the Treasury has no reason to indulge in backsiapping. Revenue results disclose a serious failure of -Treas&ry departments to estimate" the extent to whieh revenue figures would be distort ed by inflationary forces. The fact" that inconie tax receipts were 10 per cent. above the estimates, does not refleet a corresponding increase in the productivity of the country but simpiy that incomes have been magniiied in terms of nioney. Again receipts from saies of war stores were largeiv underestimated because publie departments failed to realise the high prices these goods would bring. The chief fact einerging from the accounts is that even vvitli a revenue surplus of £635,000,000 and" overseas borrowing amouxiting to £800,000,000, the Government has been able to reduce the float ing debt by only £412,000,000 in 12 months.