§ Now I come to the National Debt. On the 1st of April last year the total gross liabilities of the nation were £652,540,000. The funded debt was £589,147,000. The estimated capital value of the terminable annuities was £49,351,000. The unfunded debt was £9,976,600, and loans for capital expenditure on barracks and other purposes not included in the fixed debt charge amounted to £4,066,000. On the 1261 31st March last our total gross liabilities amounted to £644,956,000. We have reduced the funded debt by £1,448,000. ["Hear, hear!"] The terminable annuities have been reduced by £4,363,000, the unfunded debt by £1,843,000, and the loans outside the fixed debt charge show a slight net increase, owing to expenditure on the purchase of the telephones and the Uganda Rail way, of £70,000. The total net reduction of the debt for the year is £7,584,000. [Cheers.] But, besides being reduced, the unfunded debt has been greatly simplified. It now consists solely of Treasury Bills. The remnant of Exchequer Bonds borrowed by the First Lord of the Admiralty to pay off the holders of Consols who refused to convert has been paid off during the past year. Exchequer Bills have ceased. ["Hear, hear!"] That security, which was invented 200 years ago by one of the greatest of my predecessors, Mr. Charles Montagu, in order to effect a great re-coinage for the benefit of the country, has often stood the Treasury in good stead, and never more so than during the great war early in this century. But those Bills, issued as they were latterly for terms of five years, the interest on them being fixed half-yearly by the Treasury, have become inconvenient. Certainly it was an invidious task to fix the interest on Exchequer Bills. You might fix it too high, and if you did there was a loss to the Exchequer; if you fixed it too low the holders of the Bills had a right to present them at certain periods in payment of duty. And in these days Treasury Bills issued for periods of not more than 12 months at a rate fixed by the competition of the market are far more convenient and a better form of security. ["Hear, hear!"] I may state that during the past year the Commissioners of the National Debt, in order to reduce pressure on the Consols market, have invested to the extent of more than one and a-half millions in Treasury Bills.