HC Deb 17 April 1961 vol 638 cc809-10

I now turn to the Exchequer prospects for 1961–62. I will take expenditure first. I have put the cost of Consolidated Fund services at £815 million, an increase of £46 million over last year's estimate. £20 million of this represents the increased cost of servicing the National Debt; another £11 million is the increase in Northern Ireland's share of the revenue; the remaining £15 million is the settlement between the Exchequer and the Post Office Fund, under the new arrangements recently authorised by Parliament.

Total Supply expenditure has already been published in the Vote on Account and the Defence White Paper. The figure is £5,187 million, which, as I said earlier, is £280 million more than last year's Budget estimate, the increase on defence amounting to £48 million and that on civil expenditure to £232 million.

Next, I come to the revenue which we may expect on existing rates of taxation. The coming year's receipts from Inland Revenue duties I put at £3,610 million, an increase over last year's outturn of £398 million. From Customs and Excise duties I expect to get £2,455 million, an increase of £65 million. Motor duties I put at £130 million, or £4 million above last year. Other revenue, at £245 million is expected to be £39 million more, after taking into account the special debt repayment from Germany which was announced at the end of last month. In total, I estimate the revenue at £6,440 million, or £506 million more than last year's out-turn.

Taking revenue and expenditure together, on the basis of existing taxation there would be a surplus above-the-line of £438 million, compared with last year's estimate of £304 million and the out-turn of £147 million.

The estimates for below-the-line payments and receipts have been fully explained in the new White Paper on the subject, so that I need not go through them in detail. I merely recall that net payments are expected to be £575 million, or £34 million more than last year's out-turn.

So the prospective overall deficit is £137 million, which compares with last year's estimate of £318 million and the out-turn of £394 million. I remind the Committee that £60 million of this difference is accounted for by the windfall of the German debt repayment in advance.