§ Mr. KENYONasked the Chancellor of the Exchequer within what length of time the whole debt would be redeemed by a ½ per cent., 1 per cent. and 2 per cent. sinking fund, respectively; and what in each of the three cases would be the annual charge?
Mr. CHAMBERLAINOn the assumption that compound interest may be taken at 5 per cent., a sinking fund of ½ per cent. per annum would complete redemption in 50 years; a sinking fund of 1 per cent. in 37 years; and a sinking fund of 2 per cent. in 20 years. On an estimated debt of £7,835,000,000 the annual cost would be £39,175,000, £78,350,000 and £156,700,000 respectively. On a 6 per cent. basis the periods would be 45 years, 34 years, and 24 years respectively, the annual cost remaining unaltered. These figures make no allowance for redemption of debt at a premium on the one hand, nor for purchase at a discount on the other.