FINANCIAL FORTITUDE

New Zealand Herald, Volume LXXVII, Issue 23620, 2 April 1940, Page 6

FINANCIAL FORTITUDE

In the financial year which ended on Saturday, half of it under a state of war, the public expenditure in Great Britain was £1,817,000,000 in round figures, or slightly less than £5,000,000 a day. The revenue was £1,049,188,000, or £54,000,000 more than the Chancellor of the Exchequer forecast in his emergency Budget produced at the end of September. To show the effect the war has already had on the national finances, the normal Budget of April last year anticipated an expenditure of £1,322,000,000, and a revenue of £942,000,000, the gap being bridged by moneys borrowed under the Defence Loans Acts. The main point in a comparison of the figures is that six months of war has added £500,000,000 to the expenditure side of a Budget which even in April was admittedly abnormal, in that highpressure rearmament had to be financed. Naturally the weight of the increase occurred in the second half of the year. The average expenditure of £5,000,000 a day conceals the fact that the figure rose after December to substantially more than £6,000,000. It has been estimated that a continuance' at this level would lead to a Budget of i; 2,550,000,000. But the rate of spending is expected to increase, and financial commentators have suggested that the current year may isee an expenditure of £3,170,000,000, or even up to £4,000,000,000. Yet a national income of more than £7,000,000,000 a year is not anticipated. On that basis, the State will be using four-sevenths of the national income for public purposes, mainly in prosecution of the war, leaving three-sevenths for the use of private persons and institutions. The reality behind .these figures is hard to grasp, but the most notable fact is that the nation does not falter at the prospect.