HC Deb 21 October 1941 vol 374 cc1624-5
50. Sir Stanley Reed

asked the Chancellor of the Exchequer whether the peace-time system of Treasury control has been adapted to war-time requirements; and whether he has any statement to make?

Sir K. Wood

Yes, Sir. Any suggestions to the contrary are not well founded. I doubt if the wide differences between the war-time organisation of the Treasury and the traditional peace-time arrangements have been generally appreciated. A primary function of the Treasury in the midst of a vast conflict is to ensure that money requisite for the successful prosecution of the war is available without delay as it is required. Delegated powers are given to the War Departments accordingly within limits agreed with the Treasury, and thus over a wide field Departments have authority to incur expenditure without prior reference to the Treasury. Where reference is made to the Treasury, there exist special arrangements, brought into operation before the outbreak of war, designed to secure the utmost expedition by the substitution of informal discussion for official correspondence, wherever possible. I have every reason to believe that those arrangements are working satisfactorily. None of this is inconsistent with another function of the Treasury, that of enjoining and seeking to secure the elimination of avoidable extravagance and waste in war-time expenditure. The expenditure of money implies the expenditure of labour, material and productive capacity, and as our resources are not unlimited, it is necessary to ensure that the best use is made of them. The war-time organisation of the Treasury has been framed with these two objects in view.

Sir S. Reed

Does the Chancellor agree that any undue relaxation of Treasury control, leading to unlimited expenditure, while there is a limited measure of saving, would inevitably mean that dreadful state which even the Governor of the Bank of England dared not name?

Sir K. Wood

It is a matter of holding the balance between the two considerations I have mentioned in my reply.