BRITAIN’S FINANCES

Evening Star, Issue 25684, 7 January 1946, Page 7

BRITAIN’S FINANCES

CURTAILMENT IN EXPENDITURE NEEDED PEOPLE SAVING LESS LONDON, January 4. In spite of certain world shortages, there is no reason for Britain to be anxious about supplies of raw mater rials. This assurance in a ‘ Board of Trade Journal ’ survey, though welcomed in business circles, does not relieve industry’s main present preoccupation with a . shortage of man power, and complaint remains widespread that the rate of demobilisation from the forces and war factories is still unnecessarily ‘slow.. This slow rate not only retards industrial reconversion, but has falsified earlier hopes of retrenchment in national expenditure.. For the December quarter the national expenditure worked out at £15,000,000 a day, or only £2,500,000 below the daily level at the war peak. Specialists in finance statistics consider the reduction of a bare 7 per cent, to £4,137,000,000 in the first nine months of the fiscal year disappointingly small, even allowing for non-recurring disbursements arising out of the .end of hostilities, such as payments for the cancellation of contracts and service gratuities..To make matters worse, there is evidence of deterioration in the public’s attitude towards saving. Repayments of national savings certificates in the period covered by the end of the year, according /to an Exchequer return, reached a record total, and for the first time since the launching of the war savings campaign they exceeded fresh subscriptions. With the willingness to save diminishing, the national income is no longer rising, if not actually falling, and stock moneys ; are already more than adequate for normal post-war needs. Expert opinion considers the need for a substantial curtailment of national expenditure urgent and imperative. Current . .authoritative estimates of .the Budgetary' deficit- for the full year range from;. £2,000,000.000 upward. This figure is only £300,000,000 less than Sir .John Aridersbn’s estimate last April, when total war was in full swing." • The' year started/off -wed on the Stock Exchange, with a further ad 7 vance in gilts and gold shares, gilts being assisted by the repayment cf £13,000,000 of New Zealand stock and the prospect of another large release of New Zealand money in February.