BRITISH DEFENCE

Waikato Times, Volume 124, Issue 20743, 1 March 1939, Page 7

BRITISH DEFENCE

LOANS BILL DEBATE INCREASE IN BORROWING LIMIT OF £800,000,000 (United Press Assn.—Elec. Tel. Copyright) LONDON. Feb. 27 The second reading of the Defence Loans Bill, giving effect to the financial resolution passed Ly the House of Commons last week providing for the increase to £800,000,000 of borrowing powers for defence, was moved by the Chancellor of the Exchequer. Sir John Simon, in the House of Commons today. Sir John Simon stated that his object in indicating in advance of the Budget the proportions in which the total anticipated defence expenditure of £580,000,000 in the next financial year would be met from revenue and money on loan account, and his object in all his actions in connection with the defence loan programme, had been to promote confidence by removing uncertainty. He claimed that his statement of last Monday had operated as an encouragement to British tiade and finance. Indications of Recovery Referring to comments on the fact that he apparently proposed to take only £230,000,0uu from revenue for defence next year, which was less than in the current year, Sir John Simon said he could say, still without anticipating his Budget statement, that the Budget for next year must reflect to a certain extent the conditions of the past year. Those conditions, while not those of marked depression, were certainly not those of a year of great and exceptional prosperity, but all indications for next year were indications of recovery, and it was, therefore, extremely likely that the Budget for the year ending March, 1941, would reflect more prosperous conditions than the Budget for the coming year. The Labour Opposition had put down a reasoned amendment stressing the urgency of more effective measures being taken for the co-ordina-tion of the various defence services, the organisation of supply and the strict limitation of profits.’ A Check on Profits Referring to the question of profits, Sir John Simon said the Treasury was deeply concerned to secure in every practicable way that good value was obtained for the vast outlay on armaments. He had olosely examined with hie officials the general system by which profits on contracts wero checked, and he was convinced it was a good system. After Mr F. W. Pethick-Lawrence had moved the Labour amendment and Sir Archibald Sinclair had indicated that his party, the Opposition Liberals, would support it, tlie Secretary for Air, Sir Kingsley Wood, intervened to refute charges of excessive armament profits so far as Ills department was concerned. Sir Kingsley claimed that the methods of financial control available to the Air Ministry were sufficient to enable it to feel reasonably confident that the contracts it made allowed no opportunity for exaggerated profits. Tribute to Aircraft Industry In a tribute to the British aircraft industry for the manner in which it bad expanded its undertakings to meet the demands of the Government air programme, the Minister mentioned that its prices had been shown to be in many cases lower than those of American firms. He deprecated the charges of profiteering against manufacturers, which created bad feeling between employers and employed, and discouraged national service. The Labour amendment was defeated by 232 votes to 117 and the Bill was read a second time.