BRITISH RECOVERY

Greymouth Evening Star, 18 October 1946, Page 8

BRITISH RECOVERY

HOPES OF CHANCELLOR OF EXCHEQUER THE WORST SHORTAGES LONDON, Oct. 16. . The Chancellor of the Exchequer (Dr. Hugh Dalton), in a speech at a bankers’ dinner, predicted first that the worst shortages by which -Britain at present was vexed would be overcome “a year or two hence”; second, ing account for this financial year would be less than anticipated; and third, that Britain next year would come within striking distance —if it should be wise to strike—of a balanced Budget. Dr. Dalton said the reconversion of industry had taken place with surprising speed and smoothness. The export drive had beaten all estimates although it still had a long, hard road to travel before equilibrium was securely established. The difficulties ahead were a challenge to stimulate courage and initiative. Dr. Dalton condemned “payment by Britain of reparations to Germany.” He said the cost of the occupation was a burden every British taxpayer had a right to resent. Britain was spending her scarce' resources in feeding the Germans. This was one reason why the people of Britain could not have more food. One of the first tasks in dealing with Germany’s future must be to end “this most intolerable imposition on our humane good nature.” The Germans must develop their, exports to pay for their imports without at the same time developing the power to start a third world war. ■ Dr. Dalton commented that some financial circles appeared to be arguing that the present levels were being maintained only through persistent large-scale support of the giltedged market on behalf of the Government. “The departmental funds concerned, including the Bank of England issue department, have in fact been net sellers, not net buyers, of marketable gilt-edged securities other than Treasury bills,” said Dr. Dalton.

“A national debt of more than £24,000,000,000 can be endured only if the average rate of interest is kept low. Indeed this is a necessary condition to any substantial future relief from taxation."

Dr. Dalton said that Britain must build up large reserves of gold and dollars against the time when sterling again became freely convertible for current trading.