Motion made, and Question proposed,
That a Supplementary sum, not exceeding £1,000,000,000, be granted to His Majesty, towards defraying the expenses which may be incurred during the year ending on the 31st day of March, 1943, for general Navy, Army and Air Services and supplies in so far as specific provision is not made therefor by Parliament; for securing the public safety, the defence of the realm, the maintenance of public order and the efficient prosecution of the war; for maintaining supplies and services essential to the life of the community; and generally for all expenses, beyond those provided for in the ordinary Grants of Parliament, arising out of the existence of a state of war.
I have to ask the Committee for a further Vote of Credit to meet the expenditure necessitated by the war. The Committee will remember that when I last addressed them in this connection, in March of this year, I asked for a Vote of £1,000,000,000 to carry us through the opening months of the current financial year, and I indicated that I should probably find it necessary to approach the Committee again about the middle of the present month. As it turns out, we had issued up to Saturday last £898,000,000 out of that £1,000,000,000 voted in March, leaving £102,000,000 in hand. During recent weeks our total war expenditure has been at the rate of approximately £84,250,000 a week, and at this rate it is apparent that the Vote will become exhausted some time during the course of next week. I therefore now ask the Committee for a further sum of £1,000,000,000, which will, on the basis of the present level of our expenditure, be sufficient to meet requirements until the early part of September, when I shall have to ask the Committee for a further grant. If it passes this Vote, Parliament will have granted a sum of no less than £10,050,000,000 in Votes of Credit since the beginning of the war.
I mentioned a few moments ago that our total expenditure in recent weeks has been at the average rate of about £84,250,000 a week, that is, £12,000,000 a day. Expenditure on Fighting and Supply Services is now averaging £68,750,000 a week, or approximately £9,750,000 a day. There is a decrease of £500,000 in the total figure as compared with the daily rate of total expenditure which I gave the Committee last March. The Committee will remember that in March I explained that certain trading and other receipts arising out of the Vote of Credit Services would be applied towards reducing expenditure out of the Vote of Credit. It so happens that in recent weeks such receipts have led to a drop in the daily rate of expenditure on Miscellaneous War Services, and receipts from the Fighting and Supply Services have also shown an appreciable increase. Despite this, however, the daily rate of expenditure on the Fighting and Supply Services is the same as three months ago, and therefore reflects the continued increase in the intensity of our war effort. I do not propose to-day, as we have so recently been engaged in discussing the state of our national finances, to trespass on the time of the Committee by any further survey of our present financial affairs. I hope that on this account we shall not fail to realise the magnitude both of our war effort and its cost.
It is two years ago since we left behind the actual highest rate of expenditure at any one time in the last Great War. In that two years our daily expenditure has increased by nearly three-quarters, and even in the last year it has increased by nearly £2,000,000. The Votes of Credit, without including the one which we are asking for to-day, already exceed the total of those granted in 1914–1919 by some £300,000,000. Our total expenditure during this war has already reached the astronomical figure of £8,600,000,000, or £200,000,000 more than the total Vote of Credit expenditure in the last war. This is by far the costliest war in history. I need hardly say to the Committee that this does not dismay us. There will be no faltering in the financial, or any other, sphere, and the task of financing the war will not dismay us. These large sums must be wisely spent, inflation must continue to be avoided, our resources must be carefully husbanded, and savings must be increased. All these are matters vital not only to our present affairs but to the strength with which we shall be able to advance post-war reconstruction and development. I would only say this in conclusion, that I think everyone will agree with me when I say that our people have done splendidly in shouldering the heavy burdens, and this Vote to-day is another expression of our unanimity in prosecuting this war, and our determination to leave nothing undone until victory is achieved.
I am quite sure that the Committee is anxious to proceed with the next item on the Order Paper, and therefore, important as is the subject which we are now discussing, I do not propose to take up any appreciable amount of time. I will say only two things. In the first place, the financial prosecution of this war has taught us one striking fact, which is that nothing which is economically possible ought to be financially impossible. The second conclusion to which I come is that, seeing how enormous the productive capacity of the combined resources of the world is, after the war is over the productive machinery should be ample to provide every inhabitant of the world with all that is required for a complete life, and if our civilisation fails to do that, it will be the civilisation that will be at fault, and not the productive machinery.
Like the right hon. Gentleman who has just spoken, I do not propose, in the special circumstances of to-day, to detain the Committee for more than a few moments. I was struck by one remark he made, that anything economically possible was also financially possible, or something of that kind. I should have preferred to have said "economically sound" because a thing might be economically possible without being sound expenditure. This no doubt is what my right hon. Friend really meant. I suppose that no Chancellor has ever had a more unanimous welcome for his proposals than my right hon. Friend the present holder of the office has received in recent weeks. That is very remarkable, considering the enormous expenditure which the country has to face. I think, however, it is justified. If there is one thing upon which we can justly pride ourselves in connection with this war, it is the fact that, under the unprecedented conditions of expenditure which we are called upon to face, the Treasury has followed methods which are likely to leave as little damaging effects on the country as is possible in the circumstances. They deserve to be congratulated, my right hon. Friend particularly, for the course which has been followed.
I desire to make only two comments. With an expenditure which is at the rate of £10,000 a minute, or some figure of that sort, we are raising 80 per cent. of all that expenditure by the country, 40 per cent. by taxation and nearly 40 per cent. by loan over a period, and we are raising 20 per cent. of it by means of short-term borrowing. That is a very remarkable achievement for the country, but the danger arising from that 20 per cent. is still there. I know well that my right hon. Friend the Chancellor fully realises that danger, but I ask this Committee not to forget it. Even if it is only a comparatively smaller amount against the total sum involved we are still raising that 20 per cent. by short-term money. There lies the real danger which may lead to inflation. The measures which the Government have taken, by rationing and in other ways, to reduce consumption, constitute the best possible guard that we can have against inflation, but I would say to my right hon. Friend that it will be necessary to go even further than he has already gone in this direction. It will be necessary for the Government, if this war is prolonged over a period, to take further steps in the way of rationing in order to prevent, if possible, the danger of inflation. That is the real danger before the country but one which I am sure my hon. Friend always has in mind.
This is a very large sum of money, and in ordinary circumstances I think my hon. Friends and I would have insisted on a Debate on this subject. On previous occasions we have voted against these war credits, and our attitude remains precisely the same. To-day, however, we are anxious to get on to the next Business. I understand that by agreement the remainder of the Sitting is to be devoted to a discussion on old age pensions. The only comment I would like to make is this: This, as I say, is a vast sum, so vast that it makes any sum that would be required to meet even the most extravagant demands made upon the House in the matter of old age pensions, seem very trivial indeed.
May I ask the Chancellor of the Exchequer a question? Having regard to the astronomical figure to which the right hon. Gentleman has referred, have we not arrived at a time when there should be devised a safety-catch on expenditure? Is the right hon. Gentleman aware that in the country there is a certain amount of disquietude in regard to the extraordinary rate of expenditure per day which has been reached? I do not desire on this occasion to make a speech, but I would put that question to the right hon. Gentleman, because it is very important indeed. These figures continue to increase, and we want to be assured that there is no leakage and that we are getting value for the money.