LIVING BEYOND MEANS

Chronicle (Levin), 17 August 1949, Page 5

LIVING BEYOND MEANS

f. N.Z.P.A -

— Reuter .

Warning That Britain Must Cut State Spending

Copyright)

Received Wednesday, 11 a.m. LONDON, Aug. 16. Warning that the "vasf increase in State expenditure" is an infia'lionary infiuence in Brita'in's economy, the Federation of British Industries says that Britain is stiil living beyond her means. In a statement on the economic crisis, the federation says that Bri.ain is in grave danger of being unable to get the food and raw materials it ne'eds, Unemployment and more austerity would result if a solution was not found. Britain had a special responsibility to play its part in the establishment of Western recovery. If she 'did not earn it she had no right to expect a higher standard of living than her neighbours. "Evidence is accumulating that Britain is believed by other countries 'to be attempting to achieve too quick y what she can no longer afford," the statement says. "Taxation and, therefore, Government expenditure must comejlown. The tax gatherer coilects eight shillings from every pound that the nation produces. Profits are taxed even more heavily than this and no opportunity is left to create adequate reserves." The federation urges the further lifting of controls and the adoption of all aids of productive efficiency. It contends that schemes like the nationa.isation of the iron and steei industries are "irre.evant to the present crisis and distracting and damaging tO iheir prospectsY