§ 51. Sir Waldron Smithersasked the Chancellor of the Exchequer if, in view of the fact of the recent issue of Exchequer Bonds at 1¾ per cent. less tax and that the actuarial calculation for the social insurance proposals are worked out on a basis of 3 per cent., free of tax, he will prepare and publish in the OFFICIAL REPORT a revised estimate on a basis of 1¾ per cent. less tax.
§ Sir J. AndersonNo, Sir. The low rate of interest on a particular short-term issue of Government securities does not vitiate the assumptions made in the social insurance calculations which relate in the main to long-term pensions considerations. The exemption from Income Tax of the investments of social insurance funds is conferred by Statute.
§ Sir W. SmithersDoes not the Chancellor recognise that if the scheme is not sound actuarially, the bottom is knocked out of it?
§ Sir J. AndersonThe point of my answer is that the actuarial basis of the scheme is sound. The rate of interest assumed in the scheme is not comparable with the rate of interest paid in present circumstances on short-dated securities.