§ Mr. BRIGGSasked the Chancellor of the Exchequer whether the £63,169,741, guaranteed under the Trade Facilities Acts, as shown upon the House of Commons Paper, No. 14, bearing date 12th February, 1926, is the capital amount guaranteed or the capital amount plus the capitalised value of the interest due upon such capital amount?

§ 15 Mr. R. McNEILLA capital sum of £63,169,741 has been guaranteed as to principal and interest. I am afraid that I do not see any other way of stating the facts. If the hon. Member desires to capitalise the interest (i.e., to assume that it is all paid in one sum now), he must also take the present value of the future liability for principal. Suppose, for instance, there is a loan of £100 repayable in 15 years and bearing interest at 5 per cent., the guarantee would apply to (a) the payment of £5 each year for the next 15 years, (b) the pay- 74W ment of £100 at the end ofyears. The present value of (a) is £51 18s., and the present value of (b) is £48 2s., and these two sums simply add up to £100. Similarly, the sum of £63,169,741 represents the liability in respect both of the guarantee of interest payments and of the guarantee of the repayment of capital at the end of the loan periods.