§ 36. Mr. Warbeyasked the Chancellor of the Exchequer if he will give an estimate of the annual saving, at the current average volume of outstanding Treasury bills, if the rate of interest on these bills were reduced to ½ per cent.
§ Mr. H. MacmillanThe interest paid on the bills issued through the weekly market tender in the last twelve months was £133 million. If those bills had been issued at the rate of ½ per cent. the interest paid would have been £17 million. If they had been issued at nought per cent., the interest would have been nil.
§ Mr. WarbeyCan the Chancellor say, first, what the additional burden will be through the increase in interest rates to 5¼ per cent.? Secondly, if the Government desire to save in public expenditure, why is it not possible for them to reduce the interest rate to ½ per cent., which the Labour Government managed to do for six years? Would not that be a better way of saving money than stealing the cream out of the pensioners' milk bottles?
§ Mr. MacmillanWe can argue about monetary policy; we did so yesterday, and we shall do so again today. All I can say now is that the monetary policy which the hon. Gentleman recommends led practically to bankruptcy, to a rapid dissolution of Parliament and to the Government of the day running away from their responsibilities.
§ Mr. F. M. BennettWould not the Chancellor agree that this Question is ridiculous anyway, since no one would lend his money at such a rate at the present time?