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House of Commons Hansard
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Financial Statement
26 April 1938
Volume 335

3.45 p.m.

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Every Budget statement deals with three matters in turn; it is, so to say, our annual problem play presented in three acts. In the first act we have the review of the financial year which has just closed, and the comparison of the actual outturn, both of expenditure and of revenue, with the estimates which were made 12 months ago. This contrast between prophecy and performance brings out the first figure of definite interest in the drama, which is the balance—on the present occasion, as the Committee knows, a substantial surplus of £28,786,000. Such surplus ordinarily goes to the National Debt Commissioners for the reduction of past debt; but, as it would be absurd to pay off debt with one hand while you are borrowing with the other, the Defence Loans Act of last year provides that this surplus has to play a part in our future arrangements somewhat different from that which a surplus ordinarily takes.

Then comes the second topic on which I have to enlarge, namely, the components of the total—the very formidable total—of our prospective expenditure in the present year, and the estimate of prospective revenue on the existing basis of taxation to set against it. On this occasion the Committee must prepare itself to find that this comparison leads to a balance which will show a deficit to be met. Then, the figure of the balance having been precisely ascertained after a necessarily rather elaborate statement, the stage is set for the curtain to rise on the third and decisive act, and the author presents to his critics in the stalls and to the public in the gallery his solution of the problem which he has thus laboriously developed. I shall follow the traditional course, and I shall endeavour to place the necessary figures before the Committee, as the seriousness of the times and the immensity of the totals require, without any elaboration and in as simple and plain a form as I can command.