reinforcements to be sent to these strategic points, but, taking them in order or priority, they are not as vital as the defence of our own country, because as long as we are undefeated at home, although we sustained losses overseas we might have an opportunity of making them good hereafter. The fourth and last objective which I will mention can be stated quite shortly, namely, co-operation in the defence of the territories of any allies we might have in case of war. These objectives have been before us in the preparation of each of the Service programmes. We have endeavoured to give to each Service means adequate to the role it is expected to play. Taken as a whole the programmes represent a careful balance struck after due account has been taken of the considerations I have mentioned, and when they are added together I think they form an impressive picture of the armed power and economic might of this country. " I think I must here interpolate something about the cost. In February, 1937, when I was still at the Treasury, I said to the House that the expenditure before us could not, in niy opinion, be met entirely from revenue, and afterwards a Memorandum of the proposals of the Government was circu- lated to the House and subsequently received Parliamentary sanction in the shape of the Defence Loans Act, 1937- I should like now to repeat one or two of the outstanding points which were put before the House on that occasion. In the first place, we said that expenditure on Defence in future years would undoubtedly be very much higher than the £188,000,000 which was provided in 1936-37. It was not at that time possible to say which year would see the peak of the expenditure, but we indicated that it would be very imprudent to anticipate that the total sum required over five years would be much less than £1,500,000,000. We said then that neither the amount nor the period of any borrowing could at the moment be predicted. All that we could do was to put a limit to the amount which might be borrowed, and in the Defence Loans Act that limit was fixed at £400,000,000. " In connection with that we laid down certain important principles: First, that the Estimates should show the total expenditure of the amount of money to be borrowed as well as the net amount which would be required to be found by"