WAR EXPENDITURE

Nelson Evening Mail, Volume 77, 21 October 1942, Page 2

WAR EXPENDITURE

INCREASE IN DAILY AVERAGE SUPPLEMENTARY CREDIT VOTE STATEMENT BY CHANCELLOR (Rec. 11.45 a.m.) Rugby, Oct. 20. Moving a supplementary vote of credit for £1,000.000,000 for the war, Sir Kingsley Wood, Chancellor of the Exchequer, first welcomed the visit of Mr Morgenthau, Secretary of the United States Treasury, who ! stood very high in the councils of the United Nations. The new vote of credit, said the Chancellor, would make a total of £4,000,000,000 this year and £12,050,000,000 since the outbreak of war. Since 9th September the average daily war expenditure had gone up £500,000 a day and was now £32,750,000 daily, including £10.500,000 on fighting and supply services. The Chancellor said the credit now asked lor, together with the balance remaining from the £1,000,000.000 voted in September should last until February. "It is possible we have now passed the period of striking increases in tlie rate of war expenditure,” said Sir Kingsley Wood. "But this does not mean the problem of financing war on sound lines will take an easier turn or that we can relax any of our efforts On the contrary, as the war progresses and we exhaust our accumulated nest eggs and other capital sums available for investment, we will have to use other means of replacing them In this, still greater savings from current income and still greater economies absolute avoidance of all wasteful expenditure must take a high place. "A decent and proper standard of living is obviously essential, hut if we insist on spending for spending’s sake, instead of saving to the greatest extent possible we will endanger the sound economic structure ” Comparing the half-year ending 30th September with last year, the Chancellor said although expenditure was higher by £350.000.000. the amount we had had to borrow was £70.000,000 less. This was partly due to the receipt of £155,000.000 on account of the Canadian Government's generous contribution hut mainly to a higher and unprecedented level of taxation. Revenue was doing very well, both absolutely and by comparison with last year. The total volume of personal saving was increasing quarter by quarter. Sir Kingsley Wood announced the decision to make a supplementary issue of certificates in January at a definitely lower rate of interest. The purchase price would be .£1 value and would increase to 23s after ten years Sir Kingsley added : "We are entering the fourth year of the war with little cause for dissatisfaction at the financial position. The total expenditure in 1939-42 is about two and a half times as great as that in 1914-17. but the amount raised in taxation is four times as much, representing 40 per cent, expenditure compared with 21 per cent. Moreover, the average rate of interest on the increase in debt so far during this war has been only 24 per cent., compared with 5 per cent, during the last war.-—P.A