Orders of the Day — Finance Bill

Part of the debate – in the House of Commons at 12:00 am on 13th December 1955.

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Photo of Sir Alexander Spearman Sir Alexander Spearman , Scarborough and Whitby 12:00 am, 13th December 1955

There is moderation in everything. I do not think that the Chancellor would agree to that.

The Financial Secretary to the Treasury told us today that the object of the Bill was to mop up purchasing power. Hon. Members opposite sometimes seem to be uncertain whether they think the object of a Finance Bill should be to attack inflation or to attack a rise in the cost of living. They are very different things. As I understand it, inflation is a rise in money incomes, and a consequence of which is a rise in the cost of living. If we stop inflation we stop a rise in the cost of living, but if we stop a rise in the cost of living by controls or by a remission of taxes we increase inflationary pressure and thereby run into a balance of payments crisis which would be even more disastrous than a rise in the cost of living.

I support the Bill because I think it helps to get the balance between national money incomes and national resources, and I believe that it is absolutely essential to have that balance. Indeed, the only year since the war when we had that balance was the only year when there was no more than a moderate rise in the cost of living.