§ 49. Sir E. CORNWALLasked the Prime Minister whether the leakage and wastage involved in the sudden expenditure of several millions sterling a day on the War has now been checked; and whether he has taken, or proposes to take, any special steps to co-ordinate and regulate the expenditure for war purposes by the various Government Departments?
§ The CHANCELLOR of the EXCHEQUER (Mr. McKenna)Considerable fluctuations in the daily rate of expenditure on the War are inevitable, but I have no reason to think that such fluctuations have involved leakage and wastage, as implied in the question.
§ Sir E. CORNWALLDoes the right hon. Gentleman not consider, although in the early days of the War, when the expenditure was sudden, great waste took place, that now the time has arrived for greater economy, and should not regulations be introduced into the whole of the spending Departments connected with the War?
§ Mr. McKENNAI should be glad to see greater economy introduced, if possible, in the whole of the spending Departments.
§ Sir E. CORNWALLSo would the House of Commons.
§ 55. Mr. KINGasked the Prime Minister whether he will explain at an early date the reason why the War expenditure of this country, from causes beyond the control and foresight of the Government, has risen from five to six millions a day?
§ Mr. McKENNAThe estimate of £5,000,000 a day was an estimate of total expenditure, not only war expenditure, and correspondingly the figure of £6,000,000 a day relates to recent total outgoings. The statement made by me was not, as has been suggested, a surprising announcement made casually in debate, but was no more than a reminder of the figures of Exchequer issues that are published week by week and are the subject of comment in the Press.
During the last seven weeks the total Exchequer issues have been in round figures £300,000,000. On the one hand this includes a large payment for dividend on War Loan and Exchequer Bonds early in June, and on the other does not include certain payments not yet brought into account, the actual outgoings for the period being, in fact, just over £6,000,000 a day.
The unforeseen and unforeseeable causes which raised the rate of expenditure to this height during the period in question were mainly, first, the rate at which American securities were sold to the Government for the purpose of regulating the American exchange, and secondly, the rate at which the advances made to Allies and Dominions were drawn upon. The concurrence of these two causes led to the exhaustion of our borrowing powers under the War Loan Act, 1915, earlier than was anticipated.
§ Mr. KINGHas the right hon. Gentleman seen some of these newspaper comments upon his words, and were not these newspaper comments very inaccurate?
§ Mr. McKENNAIn view of the fact that some of these newspaper comments expressed surprise at the announcement, whereas they themselves have commented week by week upon the figures, I am bound to say I did feel a certain amount of astonishment.
§ Mr. LOUGHCan these purchases of American securities and payments on loans really be called expenditure at all?
§ Mr. McKENNAI was arguing the question and explaining why my borrowing powers had been exhausted earlier than I anticipated. These borrowing powers I have to exercise in order to meet issues. These issues were made earlier than was anticipated. Whether my right hon. Friend considers them properly as 1181 expenditure or not is immaterial to that argument. I had to make the issues, and therefore I had to borrow.
§ Mr. OUTHWAITEMay we look forward to the continuance of that expenditure at the rate of £6,000,000 a day, and are we to expect to drop back to the former expenditure?
§ Mr. McKENNAI certainly hope the expenditure will return to what I prefer to regard as normal.