§ 10. Mr. Keenanasked the Chancellor of the Exchequer, in view of the fact that the National Debt has been increased by £692,251,889 from £25,890,450,873 up to £26,583,032,762, during the years 1952 to 1954 and that this has increased the interest charges by over £20 million per year, what steps he intends to take to stabilise, or to reduce, the debt liability of the nation.
§ Mr. R. A. ButlerThe amount and cost of the debt depend on Budget policy and on the purposes for which additional debt may be created. Most of the increase in debt to which the hon. Member refers was, in fact, raised to finance transactions by which interest-bearing assets were acquired or created. It is mainly for that reason that between 1952–53 and 1954–55 the net cost of debt interest to the Budget, so far from increasing as the hon. Member suggests, has actually fallen by £6 million.
§ Mr. KeenanIs it not a fact that when the right hon. Gentleman became Chancellor he acquired a £600 million surplus for his first Budget? Has there not been 196 since then, by the amount I have given in my Question, an increase in the National Debt? To have prevented that from taking place, should not the Chancellor have taxed to obtain sufficient revenue? As the amount is now the highest it has ever been, and has increased during the time he has been Chancellor by over £600 million, which means an increase in interest now and in the future, what is he going to do about it?
§ Mr. ButlerI wish the position were as simple as the hon. Member makes out. In fact, by the acquisition of asset-bearing securities of a variety of types, which include loans to local authorities, capital for the National Coal Board, for example, and securities of the nationalised steel companies, the position has been improved. Although it is very difficult for hon. Members to understand that, I can assure them that it is the case.