set out 580ve (subject to the variation in paragraph 3 below), on the basis that these steps were being taken in order to avoid a loss on the Post Office services.
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3. would, however, now propose to omit any reference in 8587
age *28* pre-Budget announcement to increases in exchange line and special circuit rentals, I think it would be sufficient to say at this stage that I propose to introduce legislation (in whatever form the Lord President's Committee may think best) to simplify the whole procedure for altering rental charges. I could base this case upon the events of 1949 and the waste of man-power involved in the present system. This would enable me, if necessary, later in the year to propose an increase in rental charges with effect from such date in 1951/52 as suits the conclusions of the Lord President's Committee.
4.
On this basis, my announcement before the Budget would relate to the increases in tariffs set out in paragraph 2 excepting the telephone rental increases. The cash yield would then become £6,320,000 in 1951/52 and £8,190,000 in a full year.
5.
In accordance with the Cabinet's suggestion, I have discussed with the Chancellor the alterations in Post Office charges which should be made at the present time. The Chancellor would prefer that increased Post Office charges should produce a cash yield in 1951/52 of the £9,320,000 quoted in C. P. (51) 71, paragraph 16, but this can be secured only if the Lord President's Committee decide that the telephone rentals in existing agreements should be varied, without individual notice, by the legislation to be promoted; in that case, the new rentals could become effective on 1st October 1951, giving the yield the Chancellor desires. (If the effective date were 1st January, 1952, the yield would be £7,470,000) Any increases in other telephone charges to secure a yield of this order in 1951/52 would raise the total Post Office surplus in a full year to a level which would be quite indefensible on Post Office grounds.
Post Office Headquarters, E. C.1.,
20TH MARCH, 1951.
N. E.
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