HC Deb 01 March 1927 vol 203 cc263-4

Order for Third Reading read.

Motion made, and Question proposed, "That the Bill be now read the Third time."


The Third Reading of this Bill must not be allowed to pass without one note of warning being expressed from this side of the House. With the main object of the Bill, of course, we are in full sympathy. Useful spending by the municipalities on constructive work is an operation with which we fully agree, and we have no wish in any way to thwart it. But it must be remembered that this Bill operates to increase the public debt by a sum of £40,000,000, and that that involves more seriously our national credit. The proposals of the Bill, coming on top of the recent Conversion Loan, which was issued at a very considerable discount, involve a very large increase of the capital debt of the country. Some of us were very glad to hear on an earlier stage of the Bill a statement by the Financial Secretary to the Treasury that the present view of the Treasury is that that method of issuing loans at a, heavy discount ought not to be repeated. I believe he said that, though he did not bind himself in individual cases, the general policy of the Treasury now is that loans ought to be issued not very far below par. That is a very welcome pronouncement, following as it does the very vigorous statement by both the majority and minority reports of the Colwyn Committee. The warning I wanted to put forward with regard to this Bill is in relation to the Sinking Fund. In view of this large increase in the public debt it is of supreme importance that there should be no tampering with the Sinking Fund. Both the majority and minority reports of the Colwyn Committee are emphatic in declaring that at an early date the amount of the Sinking Fund should be increased.


We cannot have a general Debate on the finance of the country on this Bill. The hon. Member would be perfectly in order in directing the attention of the House to the effects of the Bill on national credit, or to the question of how loans are to be raised, but to go into the question of the Sinking Fund would be to open up a Debate which would be more appropriate to the Finance Bill.


I quite appreciate that ruling, and I had no intention of going at any length into the question of the Sinking Fund; but I think you will agree that it is legitimate to draw the attention of the Financial Secretary to the Treasury to the point that the increase in the debt involved in this and similar operations makes it absolutely essential that the Sinking Fund policy which has been indicated shall be adhered to in the current year.