1949-08-27 — Page 7

Drastic Cuts In U.K.'s Next National Budget

Preparing Ground For Dollar Talks

London, August 25,

Sir Stafford Cripps told department heads of the Labour govern- ment today to got ready for a £150,000,000 cut in next year's national budget.

The Chancellor of the Exchequer passed the word around, barely two weeks

before the start of Britain's dollar crisis talks with U. S. officials in Washington on September 7.

A-government informant who told pewsmen of the move stressed that it was not brought about by U.S. pressure, But other informed sources said Washington has been informed in advance of the decision to cut sponding at least an overall fiva per cent compared with the budget for the 1949-50 fiscal year, which begon on April 1,

Rubber Vs. Communism

Honolulu, August 25.

A higher rubber price will form n for better bulwark against Compaunlan to South East Asin than doller nid deled out through the Marshall plan,

American dollars spent on rub- ber rather than on Marshelt kl will keep wages and the Malayan economy up.

The current budget totals £3,000,000,000,

The Labour government has been under severe fire from nome U.S. politicians and newspapers who accuse 11 of ineffelent and spending inistration mach on social services,

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Another government informant sale on Wednesday that Britain might have to revise drastically its costly cradle to the grave national health service if the Washington dollar talks fail..

No refund dollars are spent on Britain's social services, but their enst helps keep taxes sky high. igh Laxes Increase production costs: Production costs affect the So says Carrie Grummit, at-

price of export goods which Bri. thority on the Internationally in must sell in America to earn signifleant Malayan rubber situn-dollars, for raw material and food tion, and publisher of the Straits imports.

Echo and Penang Gazette, Grum-

mit is also senior resident partner

in Peng, Malaya, of the world-

wide Turquoi Youngs Auliffe and company based London.

Mc-

in

He is here on the last leg of a two-month round-the-world bust- ness trip and leaves for Singapore by Pan-Amerlenn August 27.

Gummi bud words of cheer for anxious rubber stockholders in Hawaii and throughout the world. "Despite bandits, war and in- ternational red tape, rubber tree growing is dubsg well in Malaya and it will do better with time," he said.

Grummit said the war was just a temporary setback and damage suffered was due more in neglect than destruction,

Plantations are pretty well back to normal and their position will be better than before the war. "We have huil a chance to plant newly developed graftings which will start producing in two years," he wild.

Temporary Setback

Grummit said the development of rubber "and all business in- Sumaira" hinges on the talks at The Hugue between Dutch and Indonesian leaders. Out.of these talks will come D permanent peace instead of the cease-fire situation in Sumatra.

Grummit sald he did not be- lleve the Indonesians are ready for self-government,

"The Dutch will ultimately give way to that form of rule," he Baid, "but the best way to get the country back on its feet now is

to give the Dutch a free hand." Associated Press.

SOVIET DENIAL

Moscow, August 25. Soylet Russia does

not want other lands, the Literary Gazelle, organ at. Soviet writers, sald. to- day in an article devoted to the Ali-Union Congress of Soviet

Point In Favour

The Cripps muve to pare gov- ernment costs --und therefore toxes-would oby.ously be a point- talks. in Britain's favour at the dolor

Usually the Treasury and the other departments consult on the terms of the next budget toward the end of the preceding calendar

year.

The Informant, who told of the economy nové, · said the word from Cripps was "urgent and emphatiq," Cripps did not specify that he expected each department to reduce spanding five per cent, but that was the overall goal. Some are expect ed to save more than others.

One big economy target is likely to be the armed forcas Defence spending totais a quarter of the current budget.

The spending culs almost cer- tainly will force reduction of

Att British employees and cm- ployer's contribuje jointly up to six-shillings weekly to the scheme,

The disclosure of the economy move came on the heels of un authoritative forecast tonight that Britain's gold and dollar stocks will sog at least another $424,000,- 000 by Sept. 30.

This would bring Britain down to her lust dollar»-—$1,200,000,000, about $80,000,000,000 below the $2,000,000,000 the treasury Itself fixed last your as the danger level. -Associated Press,

THE CHINA MAIL, SATURDAY, AUGUST 27, 1940.

Senate Agrees No Request For On Arms Limit New Dollar Loan

Washington, August, 25, Two Sanato Committees voted today to put a $450,000,- 000 limit on the amount of "excess" arms that may be went to friendly nations under President Truman's Military Aid Programmo.

The combined Committenk OR Foraign Relations and Armed Services adopted an amendment by Senator Rich- ard Russell (Damberat) writ- Ing this limit Into the Arms Ald BIL

A similar limit has already been adopted by the House.. Bonator Connally (Damo- crat told reporters that the limit would be estimated on the basis of the original cost of the excess equipment,

He sold that the $450,000,000 worth of equipment the Gov-

to arhment proposed sond abroad could go to any of the countries covered by the Ald

Thele thelude European mambers of the Atlantia alliance.. Gracce. Turkey, Persia, Korea and-the Philip- pinesЯeuter.

AIR FRANCE EXPANDS

Losslon, August 25. Air France announced hure to- day plans for extending their Far Eastern service to Nummen. New Coledonia, adding 5,000 miles to the route new ending at Saigon.

The new link, operated with

he 44-seater Skymasters, will opened on September 21 and will operate vin Buluvin und Brisbane.

-Reuter.

EUROPEAN RECOVERY PACE SLACKENS

Washington, August 25.

The pace of European recovery has slackened, the Economic Co-operation Administration report-

ed, today, in a raviey of its first year's opera- tions,

OR GOLD PRICE INCREASE

Washington, August 25.

British officials here made it clear, today that Britain would not ask at the Søptember dollar talks, for u,new loon or for any other form of major dollar assistance from the United States. Nor would they press for an increase in the price of gold. Observers here thought that the British Government's spending cut, announced in Lon- don tonight, would improve. Britain's bargain- ing position.

The news did much to weaken # view held by some Americans that Britain's economic crisis was fun to the unwillingness of her government to sherifica solvency,

British officials here said that for there to beny deviation from the line of no requests for major dollar assistance,

thero would have to be a substantial change in the British Govern- ment's policy between now and September 7, the date for the opening of the Cabinet lovel talks in Washington,

It was expected, however, that Britain would, carry from Paris, to Washington her fight for a rger share of the Marshall aid funds. Britain

her estimates dollar needs from the plan at $1,500,000,000 but some Marshall

of the other European countries are seeking to cut Britain's ́ol- inention to less than $050,000,000.

Loss Rostrictions

VIETNAM INDEPENDENCE COMMISSION

Salgon, August 25. The mixed France-Vietnami Commission for application of the Vietnam independence gree ment will hold its fret, session In Balgon's Town Hall on August 31, M.- Nguyen Phan Long, Far- dign Minister" in the Vietnam Government headed by 'ox-Em-

Dal of Annam, peror Bad noppeed here today..

. Nguyen Phan Long, who will head the Vietnam delegation on the Commission, added. “The Bao Dat experiment will aucceed or fail according to the results of the Commission's work.".

an-

M. Guirlee, delegate of M, Leon The British delegation was Pignon, French High: Commission. also expected to ask for the rear in Indo-China, will head the Inxation of some of the restale French delegation. tions placed by the BCA Upon how and where Britain's· Mar- shall plan dollars should be spent,

M. Nguyen Phan Long recalled that under the agreement signed by Bao Dai and M; Vincent Auriol, the French President, last

At present, the ECA low for- hids participating countries to March 8 the mixed Commission spend Marshall aid dollars on is to "retch with the High Corr commodities which have been de missioner for

parti- Indo-China clared surplus in, the United jeular or provisional agreements States,

which, taking account of the cir curnstances, shall determine the The four that the United manner of transfer to Vietnam of States Government might de

a wheat surplus 'la a deterrent to the British Gov.

competences

by French authorsiy exercised

"The first question, atrendy ernment sponding of Marshall firmly advanced, will be that of plan dollars in Canada.

clara The dollars corned by European nations during the peripd were, enough to pay for only one fifth of their imports from the Western hemisphere.

The report covered the year up to April 2, 1949. However, the report added, the programme's "ultimate objective of a healthy economy in- dependent of extraordinary outside assistance' remains as a difficult but attainable goal.” The report noted that Con- which is of paramount import-

gress had set up three aims when once, both to it authorised the European Re-United States. covery Project: Boosting pro.. duction, stabiilsing

and stimulating trade among the participating nationa.

"In oach of these fields." the ECA said,

"the nations of Europe Britain's army of 700,000 govern-made substantial progress In the ment clerks and administrators. first 12 months of the European

Recovery programme.

It is also expected to affect Britain's social services including the national health service. These, services together with the govern- ment's subsidies to keep basig foods cheaper eat one-quarter of the total budget.

Special Charge. Likely

The informant said the govern- ment might have to levy a special charge to keep the public from abusing the health service.

One suggestion is that every- one who géok to a doctor or a dentist should pay -one shilling both to discourage ratkleán una of the morvice and to provide the government with more re- venue.

The Health Ministry's estimate of the cost of the service for tho current fiscal year originally was about £250,000,000. The Minister of Health, Aneurin Bevan, re

Fence Partisans opening here to-cently had to ask parliament for night.

the

"Creative labour, and, friendship of peoples is the basis

of our Soviet policy," the period-

ical said.-Beuter.

an extra £21,000,000 to pay un- foreseen costs

:

The Informant said Bevan may have to ask for still more before the. Ascal year is out.

dest pay any a.bution then to Tax

It is prudent to insure "rather than to take a

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Europe and

the

currencies While exports as a whole were ECA sald, trade among the Wes- back on a pre-war footing, the

term European nations themselves lagged at about 10, per cent be- low the pre-war level. However, the report went on, the first three months of 1949 showed a brighter "As the year drew to a close, picture than the preceding nine however, there were indications months: trade as a whole was

slackening in the rate of per cent above the average be- progress, particularly in the ex-fore the war, while trade among port trade, which gave warning the European nations was ve the dimcult problems that per cent higher. The report also must be solved before the goui took an optimistic view of the of economic independence, can be European inflation situation. attained."

of

of

"The continued increase in Equal To Pre-War

industrial and agricultural out- The agency noted that Western supply, restrictive credit policles, put, the levelling off of the money Europe boosted its exports during easing of the labour market, ac- the year until they were about celerated decline in world com equal to the pre-war volume This, it said, was a significant in Internal government financing momodity prices, and improvements gain. "But the persistent dim. culties in earning dollars have cral relaxation of Inflationary

appear to have produced a gen posed

continuing problem of pressure," the report sald-Reu- sustaining the high level of trade, Iter.

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The Justice, said.

British feel that they could The question of mixed tribun- dollars considerably. ifats (lo judge cases Involving they were more free to spend parties from France or other the dollars where they chose, parts of the French Union) is

more delicate."-Reuter.

British oMelals,here did not expect Brigin to ask for any substantial reduction in Ameri- can tariffs against British goods. They pointed out that American tariffs have been steadily reduced in conformity with free trade policies.

of

They would like, however, to see a more liberal interpretation of those tariffs and, classificatiorfs the customs administration. For example, hey said it absurd to Impose on Imports of British cider the same tariff rate as on champagne, Reuter.

was

ABDULLAH

IN SCOTLAND

London, August 25. King Abdullah of Transjordan will leave for S&tlund tonight to visit the Royal Family at Bal- moral. The King and his second son, Frince Nalf, will be given a civil recaption in. Edinburgh to morrow and will spend the night 'at Gleneagles before going to Bal- moral on Saturday for lunch with King George and Queen Elizabeth.

Tonight Kind Abdullah the guest of honour at a reception given by the Datenco Minister, Perth, Western Australis,

Mr. A. V. Alexander. His coll August 25.

on the Royal Family will end his The Australian Prime Minister,

ofcial visit in Britain, which be- Mr. Joseph B. Chifley, announced

gan on August 18. He will re- hure today that negotiations be main in London privately until tween Britain and Australia for September 3, when leaves for the purchase of Australian meat fan official visit to Spain United would begin this month-Router Press,

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