Contingency Reserve

Oral Answers to Questions — National Finance – in the House of Commons at 12:00 am on 15th July 1976.

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Photo of Mr Nigel Fisher Mr Nigel Fisher , Kingston upon Thames Surbiton 12:00 am, 15th July 1976

asked the Chancellor of the Exchequer whether the additional public expenditure of £400 million announced for the present financial year will be charged to the Contingency Fund and is within what remains of that fund.

Photo of Mr John MacGregor Mr John MacGregor , South Norfolk

asked the Chancellor of the Exchequer what is the amount committed to date in 1976 for expenditure from the Contingency Fund; and what percentage this represents of the total amount allocated for the year.

Photo of Mr Joel Barnett Mr Joel Barnett , Heywood and Royton

On the assumption that the hon. Gentlemen are referring to the Contingency Reserve rather than the Contingencies Fund, I would refer them to the answer my right hon. Friend the Chancellor gave the right hon. and learned Member for Surrey, East (Sir G. Howe) on 7th June.

Photo of Mr Nigel Fisher Mr Nigel Fisher , Kingston upon Thames Surbiton

I am very inexpert in these matters, but even if the extra expenditure falls on and within the Contingency Fund is it not rather odd to be increasing Government spending when by general consent, except that of some Labour Members below the Gangway, it should be drastically reduced?

Photo of Mr Joel Barnett Mr Joel Barnett , Heywood and Royton

I find that quesetion rather odd, because many of the hon. Gentleman's hon. Friends, and I think he himself, are constantly demanding that we should increase public expenditure in certain areas and on certain programmes. I could make a huge list of their demands to increase public expenditure. I have noted what the Opposition say on these matters, but I prefer to stand on what we are doing.

Photo of Mr John MacGregor Mr John MacGregor , South Norfolk

Is it not the case that a quite high proportion of this year's Contingency Reserve has already been committed in a short part of the year? Does not that cause additional worries that there is no proper control yet over public expenditure even this year, let alone next?

Photo of Mr Joel Barnett Mr Joel Barnett , Heywood and Royton

I do not accept that. As the hon. Gentleman knows—he is a member of the General Sub-Committee of the Expenditure Committee—about £400 million has been committed out of the £875 million Contingency Reserve. But we have made it absolutely clear time and again that there is no question of that Contingency Reserve being exceeded in 1976–77. The method of control of public expenditure is enormously improved on what it was under the hon. Gentleman's Government. The present Government will ensure that there is no extra over and above the Contingency Reserve as set out in the last White Paper.