§ SIR EDWARD SASSOON (Hythe)
I beg to ask the Secretary of State for India what is the present position of the Gold Standard Reserve; and whether he intends to continue indefinitely the practice of adding to it the whole of the profit on coinage.
§ Mr. MORLEY
Up to 31st March, 1907, £12,518,513 derived from the profit on coinage and from interest had been invested in British Government securities on behalf of the Gold Standard Reserve and £4,000,000 was held in rupees in India. The profit to be realised on coinage in 1907–8 will, it is anticipated, be considerable, though the exact sum cannot of course be stated at present. In view of the amount of the reserve and of the large stock of gold (about £10,500,000) held by the Government of India and the Secretary of State in Council in the paper currency department and elsewhere, I have decided that the present practice of adding to the reserve the whole of the profit on coinage and of the interest on securities already purchased may be modified. From the present year and until the reserve reaches £20,000,000 one half of the profit on coinage together with the interest on securities will be added to the reserve, and the other half of the profit will be use to supplement the funds available for capital expenditure on Indian railways. This decision, which is based on a recommendation made by the Departmental Committee on Indian Railways, has enabled me to sanction an addition of £1,000,000 to the programme of capital expenditure for the present year. The additional expenditure will be devoted to improving the equipment of open lines.