Frank Forecast of Britain’s Gigantic Defence Programme

Northern Advocate, 21 February 1939, Page 6

Frank Forecast of Britain’s Gigantic Defence Programme

(Received 2.30 p.m.) RUGBY, February 20. DEBATE IN THE HOUSE OF COMMONS ON DEFENCE WAS A OPENED BY SIR JOHN SIMON, CHANCELLOR OF THE EXCHEQUER, WHOSE SPEECH WAS NOTABLE FOR ITS FRANK FORECAST OF THE APPROXIMATE PROPORTIONS EN WHICH DEFENCE EXPENDITURE IN THE COMING YEAR WOULD BE MET FROM REVENUE AND FROM BORROWED MONEY RESPECTIVELY. Sir John told the House he w,as working on an assumption that of the £580,000,000 which it was revealed in last week’s White Paper would be the total of the expenditure on defence, including civilian defence, in the coming financial year, approximately £240,000,000 would be available from revenue, and about £350,000,000 wou Id have to come from the loan account.

A Warning. He added a warning that no one should draw any further conclusion —presumably as to the time or manner of further borrowing, or as to taxation and proposals of the forthcoming budget—from the forecast. The Chancellor claimed that the principle of borrowing for this purpose was established and acceptable, and it was generally, recognised that the financial strain involved in the reorganisation of defence was greater than the revenue could bear alone. - What was necessary was that they should demonstrate a readiness to bear each year a proper share of the. burden, and, in evidence of such determination, he cited figures to show, taking three years ending March. 1940, together, that out of a total expenditure of about £1,250,000 for defence, about £700,000,000 would have to be met from revenue. Repayment Provision, Provision for the repayment of borrowed money in connection with the present proposals was quite specific. When a department had received a duly authorised issue of loan money, then interest at the rate of 3 per cent was charged against that department to the end of a five-year period, and thereafter sums had to be repaid to the Exchequer. A resolution moved by Sir John provided, firstly, for an increase of the borrowing powers authorised by the 1937 Defence Loan Act from the total of £400,000,000 to £800,000,000, and, secondly, for redefinition of defence services for the purpose of the Act, so as to permit expenditure on the loan account for civilian defence, and grants in aid of essential commodities from the reserve fund.

Civil Defence Essential. The Chancellor said that civil defence was more and more seen to be an essential part of defence. as a whole, and it was illogical that nonrecurrent expenditure for air raid .precautions, for example, should not benefit by the Act. Any .expenditure, moreover, on food stores in connection with the safety of the country was obviously an appropriate subject for loans under the Act? Speaking of the formidable total of defence expenditure with which the country was faced, Sir John reviewed the progress of the rearmament programme. The first year had been largely one of preparations, the present year had been one of rapidly increasing production, and the third year, with the great expenditure they now contemplated would be one with production at full blast. Increase In All Services. It would be a chronicle of the provision of equipment for the great increases in personnel in all three services. For the Navy personnel, which had increased by 33,000, there was a great building programme, including no less than nine capital ships for four years. The great inflow of regular army recruits and a record intake into the Territorial Army called for re-equip-ment and an accumulation of war reserves which would proceed apace next year. The. recruitment of many thousands of high quality for the Royal Air Force was matched by the further augmentation of sources of aircraft production. Britain Cannot Halt. It was deplorably grievous, Sir John concluded, that so large a part of the resources of the world should be devoted to armaments. when they might otherwise be available to promote and sustain peaceful progress, but, as long as no general arms limitation, genuinely and effectively secured, could be reached, they must face the continuance of this heavy burden, and face it in the confidence that British financial strength, British character and the inspiration of democratic faith, would enable them to stand the strain as well as, if not better than, others.