§ In addressing the Committee last year I expressed the opinion that in the absence of unforseeable calamities no further increases of taxation would be needed in the current year. No one at that time had foreseen the full extent of the crisis, financial and industrial, through which the world was about to pass or had realised how slow recovery would be. When much later the position had become clear, there was of course no lack of prophecies of complete ruin and disaster to our finances. When all is said and done, however, we have passed through one desperately bad year without too great a strain, and the burdens which I have been compelled to propose this year fall far short of the gloomy predictions which have been current. I do not for one moment con-ceal my opinion that the position continues to be grave and that the finances of next year may present difficult problems. Indeed, if the world depression fails meanwhile to lift, reduction of 1409 expenditure will be the only alternative to increased taxation. For these reasons, it will be for the House to take carefully into account the proposals that may emerge from the work both of the Economy Committee and the Unemployment Commission.
§ Those who look only upon the dark side may very well say that I have only succeeded in postponing difficulties for a year. But surely that is something to be thankful for, especially when the possible difficulties may not have to be faced if the House of Commons will give effect to the expressed determination of all parties to eliminate unnecessary expenditure without impairing the efficiency of essential services. But whatever next year may have in store, there are recuperative forces at work which will in time afford relief. If we can effect substantial economies during the year, and if there is some improvement in trade, I do not think next year's Budget will be unduly alarming, but failing this a heavy increase of taxation will be inevitable next year, which I have this year happily been able to avert.