Statement by the President Concerning Limitations on Military and Public Works Expenditures.

ON AUGUST 1, I placed an over-all expenditure limitation for fiscal year 1947 of $8 billion for the military functions of the War Department, thereby requiring a saving of $1 billion. At the same time a $5.15 billion limitation for the Navy Department required a saving of $650 million in this fiscal year. These limitations have not been changed and no further military cutbacks for the fiscal year 1947 are under consideration at this time. The responsible officials of the Bureau of the Budget, the War Department, and the Navy Department are working together in effecting the required curtailments.

At the time expenditure limitations were imposed on non-military Federal public works for the fiscal year 1947, it was necessary to estimate the effect of the screening of construction projects by the Office of War Mobilization and Reconversion. These limitations were very rigid and reduced the over-all Federal public works program from $1.6 billion to $900 million, requiring a saving of $700 million.

Further study of the whole public works program by Reconversion Director John R. Steelman and Budget Director James E. Webb has indicated the necessity for increasing the expenditure limitation for the War Department Corps of Engineers from $95 million to $130 million, with an additional limited provision for new projects approved by Reconversion Director Steelman, and for the Department of the Interior reclamation program from $85 million to $110 million. These, together with an increase for TVA of $13 million and for the Department of Agriculture of $5 million, are the only increases in expenditure limitations on Federal construction projects which have been authorized to date, and were it not for increases in programs over which I have no authority to place limitations, a saving of $630 million would be made good. In those programs on which I could not impose a limitation, such as public roads grants and rural electrification loans, current expenditure estimates are up $95 million. Despite these unavoidable revisions, our savings on non-military public works will be $535 million below the January budget estimates.