HC Deb 06 April 1965 vol 710 cc275-6
The Chancellor of the Exchequer (Mr. James Callaghan)

Next, the Exchequer prospects for 1965–66, again on the new classification. My estimates of revenue assume that the temporary import charge will yield £138 million. I have allowed here for the reduction to 10 per cent. in the rate of the temporary import charge; and the estimate of £138 million represents what I should expect to receive if the import charge remained at 10 per cent. for the rest of the financial year. But no deduction can or should be drawn from that about further changes in the rate of the import charge. All I can say now is that we shall reduce and then abolish it as soon as our external position permits. Taking this into account, the taxes which I imposed last November are now estimated to yield £284 million. This, together with the normal buoyancy of the revenue and some changes I shall mention later, is estimated to give an increase of £705 million, or 8.6 per cent. on last year's receipts, a total revenue of £8,862 million at present rates of taxation.

I put total expenditure at £8,482 million, an increase of £690 million on last April's Budget estimate. This covers both the Supply services, of which I spoke when the Vote on Account was presented, and the Consolidated Fund standing services. I must add that £90 million more is provided for interest on the National Debt; but two-thirds of this is offset by additional interest receipts on Exchequer loans from the Consolidated Fund.

I therefore estimate my surplus at present rates of taxation at £380 million. This compares with last year's estimated surplus of £88 million. The realised surplus was £444 million.

The loans from the Consolidated Fund were estimated in the White Paper, formerly called the Below-the-Line White Paper, at £1,228 million net. Of this total £743 million is for nationalised and private industry; and £320 million is for local authorities. This compares with £209 million in 1964–65, because local authorities are being given more access to the Public Works Loan Board, so lessening their demands on the market.

Against this lending requirement of £1,228 million, I have a prospective revenue surplus of £380 million on the basis of existing taxation. The requirement for Exchequer borrowing and special financing transactions would then be £848 million.

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