The Waikato Times SATURDAY, FEBRUARY 13, 1937. BRITISH DEFENCE

Waikato Times, Volume 121, Issue 20118, 13 February 1937, Page 6

The Waikato Times SATURDAY, FEBRUARY 13, 1937. BRITISH DEFENCE

When he introduced his Budget; last year the Chancellor of the British EXL‘hequcr said: “We are entering upon a defence programme which is the largest ever undertaken by this country in peace time. It is inequitable that the whole cost of this great programme, which has to be carried through in a short time, should fall upon the revenue which is to be extracted from the people in the course of a single five-year period. Part of the expenditure in future years might properly be met out of loan.” The statement now made by Mr Chamberlain outlines the steps necessary for this most important change in policy. The Budget provisions for the defence forces in 1936-37 were originally £158,000,000. A supplementary vote of £20,000,000 was provided, and the money was to be derived from revenue. That has long been the British policy, except of course during war, and even then a. great effort is made to defray as much of the expenditure as possible out of the national revenue. It has been stated that Great Britain met one-third of her expendi< ture during the Great War in this way, and no nation equalled that surprising record.

The policy outlined provides for the expenditure of a further £400,000,000 on the defence forces, spread over five years, and the Chancellor has made a most unusual proposal. For many years any surplus in the National Accounts was automatically transferred to the commissioners for the reduction of the National Debt. Some adjustments were made during Mr Winston Churchill’s tenure of office as Chancellor, but annually 3. sum is transferred for debtreduction purposes. Mr Chamberlain proposes to suspend this process in the meantime, and to use the money for defence thus reducing the sums it may be necessary to borrow. The National Debt service would thus increase more slowly—it is £224,000,000 this year—and if the recovery of trade continued it might be possible to meet the additional charges without any further marked increase in taxation. The plan will have two effects. In the first place it will serve to convmce nations that have been straining their financial resources in order to build immense armaments that the British people do not intend to sit idle in a world rapidly re-arming. And, in the second place, the fact that only now has it been found necessary to resort to loans for the purpose of financing the armament programme will not be overlooked. It shows that the Mother Country possesses material and financial resources greater than those of the nations that have financed practically their whole operations on borrowed money, and incidentally it affords evidence of the capacity of Great Britain to stand the strain if this senseless race for ever—greater armaments is continued. But the path towards an understanding is still open, and if the nations of Europe evince any willingness to come to some agreement the support of the British Government can be taken for granted. The whole thing seems strange, in a world still suffering from the aftermath of war, but if some rulers will persist in placing their confidence and basing their policy on force, then other nations, despite their disinclination, must take whatever precautions may be deemed necessary to ensure their existence as free people.