§ Mr. Ridleyasked the Chancellor of the Exchequer what is currently the annual foreign exchange cost of aid to underdeveloped countries, and overseas military expenditure respectively; and what is now the estimated total cost of purchases including cancellation charges of American military aircraft.
§ Mr. DiamondIt is not practicable to calculate the foreign exchange cost of the whole aid programme. Estimates of the foreign exchange cost of marginal changes in the programme suggest that it is about one third, or rather more if there is pressure on the capacity of industries producing aid financed exports. The estimates rest on a number of assumptions on variable factors, and do not take account of debt service receipts due on past aid loans.
265WEstimates of overseas military expenditure are given in Annex H of the Defence White Paper Command 3927. The total dollar cost of purchase of American military aircraft including cancellation charges is now estimates as £545 million. This estimate includes maintenance costs over a 10 year period as well as capital costs and interest payments.