Clause 2. — (Power for the Treasury to borrow.)

Part of the debate – in the House of Commons on 5th August 1942.

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Photo of Mr Frederick Bellenger Mr Frederick Bellenger , Bassetlaw

But in reading the Bill I find in Clause 2 Sub-section (3) Any money borrowed otherwise than on Treasury bills shall be repaid, with interest not exceeding three pounds per cent. per annum… Then it goes on to say: …at any period not later than the next succeeding quarter to that in which the money was borrowed. It seems to me that the 3 per cent. we are asked to pay is not for long-dated securities as we understand that term but for comparatively short-dated securities. I suggest that in transactions of this kind, which are somewhat analogous to Post Office Savings Bank deposits, there is some similarity between the trustee savings deposits and the Post Office Savings Banks which are a form of short-dated security, and this type of security on which the Government ask us to pay up to 3 per cent. Whether the Committee agree with me or not, I think the time is coming when the country will not be content to see the National Debt swell and increase, thereby increasing our capital liabilities and at the same time incurring increasing interest liabilities from year to year. I suggest to the Treasury that on technical grounds alone, apart from questions of equity, the Treasury might consider reducing the 3 per cent. inserted in this Bill to the 2 per cent. advocated by my hon. Friends.