HC Deb 02 May 1904 vol 134 cc99-100
MR. McCRAE (Edinburgh, E.)

To ask Mr. Chancellor of the Exchequer whether he will state the basis of calculation on which the estimate of £6,600,000 as the contribution to the Sinking Fund for the reduction of the National Debt was made for the financial year 1903–4, in view of the fact that a sum of only £5,149,000 appears to have been so applied.

(Answered by Mr. Austen Chamberlain.) The amount actually issued to the National Debt Commissioners for repayment of the capital of the Debt, consisting (1) of the portion of the Terminable Annuities, representing principal; and (2) of the "New Sinking Fund," amounted in all to £6,509,932, as against the estimate of £6,600,000 given by the Chancellor of the Exchequer a year ago. If we leave out of account the Transvaal repayment of £3,000,000, which was applied in extinction of Exchequer Bonds, the total "dead weight" debt was reduced within the year by £5,149,000. This, however, is the net sum. The reduction would have been £2,000,000 more, had it not been that a temporary advance of that amount was obtained from the Bank of England at the end of the year to strengthen the Exchequer balance. The balance had been temporarily depleted to that extent by issues to meet expenditure on capital account, which the National Debt Commissioners wore unable to replace within the year. It must be remembered that the amount by which the Debt is reduced in the year can never correspond with the amount of money applied in redemption of debt, because a given amount of cash will cancel either a larger or smaller amount of stock according as the stock stands below or above par, and because it seldom happens that the National Debt Commissioners are able to apply all the money issued to them within the year.