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War Loans (Rate Of Interest)

Volume 149: debated on Friday 16 December 1921

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asked the Chancellor of the Exchequer whether, in view of his declaration that a cut of £175,000,000 is required in national expenditure, he has considered the desirability of a reduction of two per cent. in the rate of interest on war loans, which would effect a saving of approximately £160,000,000; and if so, whether he is prepared to advise the Government to take the necessary steps to effect this saving?

The answer to both questions is in the negative. Any such action would be a direct breach of public faith.

Is it not the case that direct breaches of public faith have already been made by the Government, and that the same argument can be applied to this as to the reduction of wages of the workers, where also a direct pledge was given, namely, that the cost of living is coming down and that consequently the cost of money should come down as well?