HC Deb 07 July 1920 vol 131 cc1596-8

(1) Any amount applied out of revenue during the current financial year in purchasing, redeeming, or paying off any description of debt shall be deemed to be expenditure within the meaning of Sections four and five of the Sinking Fund Act, 1875.

(2) Any sums issued out of the Consolidated Fund for the purpose of the depreciation fund under Section thirty-two of the Finance Act, 1917, and any sums so issued to the Commissioners of Inland Revenue in respect of any securities transferred to those Commissioners by way of payment for Death Duties or Excess Profits Duty, and any sums so issued to the National Debt Commissioners for the purpose of the purchase by those Commissioners of four pounds per cent. Victory Bonds or four pounds per cent. Funding Loan, 1960–90, shall for the purposes of this Section be deemed to be sums applied in purchasing, redeeming, or paying off debt.

Motion made, and Question proposed, "That the Clause stand part of the Bill."

Major BARNES

For the benefit of young members of the Committee, perhaps the right hon. Gentleman would explain what is the necessity for this Clause?

Lieut. - Commander KENWORTHY

Already in the passage of this Budget the Chancellor of the Exchequer has given up certain sources of revenue, and I am rather expecting that on Monday we shall hear of other concessions being given, which will also reduce the amount of revenue. At the same time, the expenditure has been increased in certain very important directions. In the Financial Statement for 1920–21 the balance available for Debt reduction is given as £234,198,000, but, owing to the concessions made, we know that that amount cannot possibly be available. I would therefore like to ask the Chancellor of the Exchequer, before we go any further, if he will give a rough approximation of what will be the reduction of that estimated sum of £234,000,000?

Mr. CHAMBERLAIN

The most convenient plan, I think, would be that which is usually adopted, that, when we have reached the Third Reading stage, I should give the House some indication of the general effect of the changes we have made. I could not give any useful information now. As regards the question put as to the general purpose of the Clause, it is to enable us to employ the surplus of the year in the reduction of debt during the year, without waiting for it to fall into the Sinking Fund at the end of the year, as we should otherwise have to do.

Captain W. BENN

I understand this is the ordinary habit of devoting any amount raised in taxation in excess of the needs of the Departments to the Sinking Fund. There are two or three cases that have arisen this year, and one is the case of the new Ministry of Mines, which is to be constituted from parts of other Departments which have been gathered together under the new Minister. Those Departments have already presented Estimates for this year for a certain amount, and presumably the Minister of Mines will have Estimates for his new Department. Under this Clause, are we to understand that the surplus created in that way in these Departments is going to be devoted to the Sinking Fund, or shall we have new Estimates presented, and the Minister of Mines standing here and explaining the expenditure of his Department?

Mr. CHAMBERLAIN

The surplus of the year forms the old sinking fund, but this year we do not want to wait till the year is closed, with so large a surplus as we are contemplating; we want to apply it during the course of the year as it accrues, and that is the whole purpose of this Clause. My hon. and gallant Friend asks whether the savings on particular votes by reason of the transfer of a charge to other votes will fall into the surplus. If it is a net saving, yes; if it is a mere transfer, obviously it would not increase the surplus, but whatever surplus there is we are given power to apply under this Section not merely after, but during the year.

Captain BENN

I am very much obliged to the right hon. Gentleman for his explanation, but what practice is he going to pursue in relation to these particular Estimates? Are these Departments going to surrender the surplus?

The CHAIRMAN (Mr. Whitley)

That point has nothing to do with the Clause. It is a proper subject for an inquiry of the Financial Secretary to the Treasury at Question Time.

Clauses 51 (Charge for road improvement grant), 52 (Amendment of s. 12 of 61 & 62 Vict. c. 10), and 53 (Construction, short title, and repeal), ordered to stand part of the Bill.

Ordered, "That the postponed Clauses and the New Clauses be postponed until after consideration of the Schedules and any New Schedule."—[Mr. Chamberlain.]

First Schedule agreed to.