COST OF WAR TO DATE

Press, Volume LXXIX, Issue 23965, 4 June 1943, Page 6

COST OF WAR TO DATE

New Zealand’s Share £229,400,000 £123,500,000 BY LOANS From Our Parliamentary Reporter WELLINGTON, June 3. New Zealand has expended on the war a net total of £229,400,000 up to March 31, which is equivalent to more than £l4O for each man,' woman, and child in the Dominion. This was revealed in the Financial Statement presented by the Minister of Finance (the Hon. W. Nash) in the House of Representatives this evening. Mr Nash said New Zealand was now spending on the war nearly £3,000.000 every week, whereas the total war expenditure arising from the 1914-18 conflict was less than £100,000,000. “To give some idea of the magnitude of the activities involved and the purposes of the expenditure, the total war expenditure to date of £229,400,000, covering all services, has been analysed under the following headings,” Mr Nash said. Pay and allowances, £60,600,000; stores, £ 72,100,000; accommodation, victualling. and clothing, £18,800,000; land, buildings, fortifications, aerodromes, and ships, £21,800.000; transport, £8,400,000; repairs, maintenance, and rent. £3,300,000; administration and general expenses, £16,400,000; civil (including reserve stocks, Government and commercial indents), £17,400.000; reciprocal aid, reverse lease-lend. £7,000,000; miscellaneous, £3.600.000. Total expenditure, £229,400,000; cash and imprests outstanding, March 31. 1943. £9,600.000. Total. £239,000.000. ‘.'This huge outlay of £239,000.000 has been financed as follows: —Taxation (including transfers from Consolidated Fund), £88,100.000; loans in New Zealand and overseas. £123.500,000; reciprocal aid lease-lend, £26,800.000; miscellaneous, £600,000. It will be seen from th- foregoing that, of the total war receipts of £239,000.000, £123,500,000, or 52 per cent, of the total, has been raised by loans. Agreement With Britain "When submitted to the House a year ago, the estimates for the year, amounting to £133,000,000, represented an astounding increase over the previous level of expenditure, but even so it will be observed that actual costs exceeded the estimate by £11,000.000, said Mr Nash. “Costs met directly from New Zealand amounted to £101.800.000 compared to a Budget estimate of £77,000,000, whereas charges financed through our Memorandum of Security Agreement with the United Kingdom Government were £30,600,000 less than was expected. "The Budget estimate was based on provision for meeting accumulated arrears Of costs for the equipping and maintenance of our forces in the Middle East which was later found not to be required. During my visit to London last year discussions were held with the United Kingdom Government on the matter of these outstanding items and an agreement was reached providing for a new assessment of the Dominion’s liability for capital equipment. In the course of operations in Greece, Crete, and Libya, our Division had been forced to abandon a large quantity of vehicles and equipment, and the estimate was compiled on the assumption that claims for successive replacements might come to charge. “In the course of the discussions the position was clarified and a settlement arranged on a basis of New Zealand being charged with the full cost of all initial equipment, provision for maintenance being included in an agreed monthly charge. As part of the agreement. costs of maintenance in the field have now been compounded for a monthly payment of £400,000 sterling, a basis that is most satisfactory Charges under the agreement totalled £15,400,000, and repayments £8,000,000 during the year. "Army costs met directly from New Zealand, including the cost of forces in the- Pacific islands, were over £12,000,000 in excess of the estimates, but, as indicated at the time the estimates were submitted, it was most difficult to make any reliable estimate of what would be required to pay for the expansion of the forces then taking place. The Air Force estimates were exceeded by £5.300,000, due to further expansion of activities since the last Budget was submitted. “In the War Expenses Account, which is now the principal of the State’s financial responsibilities, the results for the year ended March 31 last were as follows: WAR EXPENSES ACCOUNT, 1942-43 Expenditure (In millions of pounds) Navy .. .. 8.5 Army .. 88.9 Air .. .. .. 24.3 Civil .. ' 14.9 Reciprocal aid. Reverse lease-lend ~ .. 7 Miscellaneous .. .. 0.4 144 Receipts War taxation .. .. 39.6 Transfers from Consolidated Fund—--194- surplus .. 1.7 1942- appropriation 1,5 42.8 Miscellaneous .. .. 0.4 Reciprocal aid: Lend-lease .. 26.8 Memorandum *of Security .. 15.4 Loans raised in New Zealand 62.6 148 Civil Expenditure "The large expenditure under the heading ‘Civil’ of £14,900,000 effectively emphasises the obvious fact which is often overlooked that modern war is not exclusively a strugglebetween masses of armed men,” continued Mr Nash. "The civilian war effort is second only to the efforts in the field, and the Government must, as no less than their duty, maintain the economic health of the country and direct and assist production both for the armed forces and for the essential needs of the civilian population. So we find for last year, among the larger items of subdivision Civil, the following:—Subsidies to primary producers and for stabilisation purposes, £2,300,000; reserve stocks to ensure continuity of production, £700.000: goods imported by the Ministry of Supply for State departments and essential commercial activities, £3,600.000; work carried out for the armed services, the cost of which has not yet been allocated to the services concerned. £1,900.000; soldiers’ financial assistance. £300.000; grant to Canteen Board equivalent to duty on tobacco. £250.000; war research, £400,000; Imperial Government food contracts, £1.100,000; emergency precautions scheme and emergency fire service. £400.000; National Patriotic Fund Board, prisoner of war parcels. £170.000: meat-canning, advances for extension of plants, £170.000; air raid shelters. £600.000; munition workers’ hostels. £120.000; miscellaneous. £2,890.000. “The total receipts, to which I have already referred, were expended during the year as follows:—War. £142.800.000: debt charges. £12.400.000: social services. £25.600 000: civil administration. £10.900.000; increase in cash ba’ances and imprests, £8,200.000. Total. £198,900,000"