§ I pass now to a comparison equally significant and full of warning between the indebtedness of the State as it stood ten years ago and as it stands to-day. This is a rather long and complicated chapter, and I must tax the patience of the Committee in dealing with it. The aggregate gross liabilities of the nation—;I will explain shortly what that phrase means—;on March 31st, 1896, were £652,287,000. On March 31st, 1906, they had grown to £788,990,000, an increase of £136,000,000, or 21 per cent. It will be well to keep those percentage increases in mind—;population 10 per cent.; expenditure 39 per cent; indebtedness 21 per cent. The liabilities of the nation reached their lowest figure—;£635,400,000 it was—;in 1899 on the eve of the war, and their highest for the last thirty-five years, £798,400,000, in 1903. There has thus been a net reduction in the last three years since 1903 of about £9,500,000, of which no less than £7,750,000 must be set down to the credit of the last financial year, 1905–6. Here is a fact which I think we ought all to bear in mind. In the thirty years between 1870 and 1899 the gross national liabilities had been reduced by nearly £150,000,000. The benefit of the whole of that reduction, which occupied the best part of the lifetime of a generation, has been completely wiped out in the last seven years and our total capital indebtedness stands today practically at the same figure as in 1871. These are facts which speak for themselves. Second, and second only, to the duty of reducing expenditure, is that of making a more adequate provision for the reduction of debt. In order to obtain the fulfilment of the one we are, as I explained, able to do little during the present financial year; but towards the fulfilment of the other, I am able and I intend to ask the Committee to make a substantial contribution. I ask the special indulgence of the Committee while I endeavour to track my way through a jungle of technicalities and a forest of figures. Our gross National Debt falls, as the Committee is aware, into two different categories—;first, the dead-weight debt, consisting of Consols, terminable annuities, and unfunded or floating debt, and, secondly, other capital liabilities created of late years by various Acts of Parliament and 289 incurred for the most part in respect of naval and military works. A comparison between 1893 and 1906 brings us to the following result. The dead-weight debt has risen in ten years from £648,000,000 to £743,000,000, an increase of £95,000,000, of which no less than £55,750,000 is due to the growth of the unfunded or floating debt. The whole increase in the dead-weight debt was caused by the war. The "other capital liabilities" have risen in ten years from £4,000,000 to £45,770,000—;that is to say, they have been multiplied by something like eleven times. By far the greater part of this increase has taken place in the last five years.