FINANCE POLICY DEFENDED

Timaru Herald, Volume CXLIII, Issue 20783, 19 July 1937, Page 11

FINANCE POLICY DEFENDED

STATEMENT BY BRITISH CHANCELLOR PROVIDING SECURITY FOR POSTERITY British Official Wireless (Received July 18, 6.30 p.m.) RUGBY, July 16. The third reading of the Finance Bill was passed in the House of Commons to-day. The Chancellor of the Exchequer (Sir John Simon) dealt with the criticisms of the Government's resort to boiTowing, to supplement the main contributions provided year by year by the taxpayers. Sir John drew a distinction between borrowing for immediate current needs that came to be criticised in 1931, and the present borrowing for a programme designed to give security for a generation to the taxpayers, and which was accompanied by a large contribution from the taxpayers. In 1931, there was no provision for repayment, but the provision now being made, included a specific arrangement for the redemption of what is borrowed over 25 years, and a charge on the defence loan of the annuity. What was happening under the national defence loan, was having no damaging effect on credit. Referring to the suggestions that slumps always followed periods of prosperity, Sir John said he could not accept such a Calvinistlc view, when, as at present, the expansion trade was healthy. He described as a fallacy the Opposition criticism that the present trade prosperity was of a temporary and artificial nature due in a great extent to the expansion of armaments. Immense and sustained improvement in trade took place long before. He was not disputing that the additional expansion of armaments did not increase the volume of our trade, but It was not the original or main cause of the present trade prosperity, and it did not follow that later Britain was going to fall back into the depths of a depression.