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The conseguential effects of the auf gehlar
imports which have yet to be reprogrammed. timber imports from the dollar area were cut by 30 per cent, it is estimated that a reduction of the housing programme by some 25,000 houses a year could be averted only by drawing down the emergency timber reserve by 50 per cent. This, however, would be a temporary expedient and a cut would have to be made eventually unless future timber supplies improved. Even so the position would be precarious and would depend, among other things, on the substitution of inferior grades of timber in order to get greater quantity, and on the lowering of national timber stocks to a dangerous level. Other import cuts will reduce supplies of machinery directly to the extent of some
£7 millions of imported equipment in 1949/50, and indirectly through the effect on engineering output of the restricted supplies of steel and non-ferrous metals.
(c) Sizeable reductions, however, could come only from
further retrenchment of the forward programmes of the socialised industries and the social services below the reduced levels already recommended by the Investment Programmes Committee. This would require (i) the postponement of some part of the major re-organisation and re-equipment schemes on which these industries are embarking, and (ii) some modification of existing policies in the social service field from which the investment programmes are merely derivatives.
(a) It is assumed that no substantial savings should be
sought from investment in agriculture, shipping, iron and steel, and manufacturing industry in view of the direct and relatively quick contribution that investment in these fields can make to our economic recovery.
(e)
In parallel with the foregoing it would be necessary to reimpose restrictions on the licensing of works in the category of miscellaneous building.
The broad conclusions of this analysis are, therefore,
as follows:-
(i) Cuts of the order of £300 millions in the investment programme for 1952 (as has already been recommended by the Investment Programmes Committee in their last Report but not yet approved) will have to be made, if the reduced level of investment already provisionally endorsed for 1950 is not to be exceeded.
(ii) If it is desired to cut the total volume of
investment in 1950 and thereafter still furter, some postponement of major re-organisation and re-equipment plans of the socialised industries will be necessary, and also some modification of existing policies in the social service field, particularly in those services where rapidly expanding investment programmes are being contem- plated. No detailed recommendations about the Page 451 of 662