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Orders of the Day — Finance Bill

Part of the debate – in the House of Commons at 12:00 am on 19th May 1947.

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Photo of Sir Alexander Spearman Sir Alexander Spearman , Scarborough and Whitby 12:00 am, 19th May 1947

I am very glad to hear that. Some of us have thought that the Chancellor took too much comfort from the fact that that problem is still a year or so off. I would like him to lose the complacency of which some of us accuse him, and to get down to that problem now. All of us here realise how grave the situation is. I think that our expenditure abroad last year was something in the nature of £1,500 million. What we earned by our own exertions was about boo million, and that was roughly the amount of our exports. The gap of £600 million is being met by drawing upon the American loan. It means that more than one-third of what we are now spending abroad comes from the American loan and is obviously not going to last us very long. I do not believe that the people of this country sufficiently realise that fact. Generally speaking, they are expecting better times. They think there will be more to buy in the shops. It should be made plain to them that the very reverse will be the case. In actual fact the loan will soon be exhausted, and unless another is arranged and things improve very much, people will be called upon to make great sacrifices.

The Chancellor of the Exchequer demanded sacrifices from the people of this country, I am bound to say I think rightly, by the new Tobacco Duty. It was aimed at saving dollars worth £7½million or thereabouts. Unless we succeed in reducing the present gap by more than 50 per cent., from more than £600 million to £300 million, the Chancellor of the Exchequer will have to call upon the people of this country for 40 times as great a sacrifice as he called for in his Budget by the tax upon tobacco, which was a very small part of what the people will have to bear in the future. There are two Governments who can put off the evil day: the Government of the United States, by granting us another loan, and the Government of this country by so planning our affairs and our resources that we are able to stand on our own legs. Obviously, we would all, for our self-respect and stability, prefer to depend upon our own Government to get us on our legs again.

I believe that the causes of the present situation, which has deteriorated so markedly in the last 18 months, are primarily three. The first is our exhaustion owing to the war. Clearly, that is not the responsibility of the Chancellor of the Exchequer and now is not the occasion to speak about it. The second is the failure to produce the fuel necessary. It caused the economic crisis last winter, but there again, although I believe the crisis was avoidable, it was not within the province of the Chancellor of the Exchequer, except as a Member of the Government. Therefore, there is no occasion to say more about it now. The third reason, which is entirely within the Chancellor's responsibility—and that is why we ought to discuss it now—is the distortion of the spending of the people, owing to the financial policy of the Government.

The hon. Member for Wednesbury (Mr. S. N. Evans), who spoke from the opposite side of the House, appeared to think that a factor which was causing us so much anxiety was the increase in the distribution of dividends. I think he was confusing cause and effect. Without in any way advocating an increase of dividends, I suggest to him that any increase in the distribution of dividends was an effect of inflation and not a major cause of it at all.