BRITAIN’S DEFENCE.

Ashburton Guardian, Volume 59, Issue 44, 1 December 1938, Page 5

BRITAIN’S DEFENCE.

THE INCREASE IN EXPENDITURE LIMIT OF BORROWING RAISED. (United Press Association—Copyright.) LONDON, November 29. In view of the further expenditure on defence now contemplated, the Chancellor of the Exchequer (Sir John Simon) has decided that some increase in the limit of £400,000,000 authorised by the Defence Loans Act, 1936, for borrowing in connection with the rearmament programme will be necessary. For some time the suggestion lias been made in both Parliamentary and financial circles that, with a view to allaying anxiety on the part of industry and trade about the future incidence of the cost of rearmament the Chancellor should make some statement in anticipation of the Budget. It was in reply to a question on these lines in the House of Commons today that the Chancellor announced,that he had come to the conclusion that some further borrowing powers would be needed, and that it was his intention at the appropriate time next year to ask Parliament to pass legislation for this purpose. While emphasising that it would be neither desirable nor practicable to depart from the rule providing for the anticipation of the estimates or the provisions of the Budget, the Chancellor said he recognised that considerable increases in the defence expenditure which had already been announced had brought to the forefront the question of how they should be met.

The act of 1836 had authorised the borrowing of up to £400,000,000, and by *the end of the present financial year they would have met the cost of rearmament out of borrowed money to the extent of about £180,000,000. Some 220,G00,000 therefore, remained, so that the problem of authority to borrow was not urgent, but he thought at the time new commitments had been incurred that they should prepare a plan in advance.

Sir John Simon added that it would be impossible to mention the figures in anticipation of the new bill, but he made the statement to remove uncertainty as far as he could.—British Official Wireless.