B—6

improve the position of toll and telephone facilities and telecommunications generally, but, by reason of the very large programme awaiting completion, work is being put in hand first where the need is greatest. Other Works Many other works such as highway, road and bridge construction, rivers control, forestry, and mine development schemes are being undertaken as and where requirements call for operations to be carried out immediately, and these also are provided for in the current year's expenditure estimates. The works projects now in hand will take several years to complete and there are others to follow, so that the capital expenditure programme will remain at a high level for some years to come. How far we can go depends upon the resources that can be made available at the time. On the physical side, there is the question of obtaining labour, material, and plant, and to the extent that these are used for capital works there is obviously so much less available for production of consumer goods. Therefore we cannot avoid inflation, with all its harmful effects, unless an equal proportion of the aggregate income of the people is also used per medium of savings and investments to provide the money for the capital expenditure. Finance for Works Programme To assist in paying for the current year's programme I announced in May last that it is proposed to use last year's Consolidated Fund excess of receipts over expenditure, which is £4,308,000 for that purpose. That left about £33 million to be borrowed, of which approximately £2-5 million was received earlier in the year, £2O million had to be raised by the special loan issue now successfully completed, and we are confident that about £lO • 5 million will be provided through national savings during the year. To show how successful was the £2O million loan, I would like to place on record some of the figures. The response of the investing public was excellent. The amount subscribed was approximately £20,940,000. In the four-week period that the loan was open 14,071 applications were received. This total compares with 2,695 in 1946, 4,919 in 1947, 2,941 in 1948, and 2,412 in 1949. Those four loans raised by the former

19