The Press SATURDAY, JUNE 5, 1943. Memorandum Of Security

Press, Volume LXXIX, Issue 23966, 5 June 1943, Page 4

The Press SATURDAY, JUNE 5, 1943. Memorandum Of Security

During the Christchurch East byelection the Hon. R. Semple proclaimed that the Dominion had paid Britain “ every razoo ” of debt due on account of war expenditure and was “ not going to borrow one bob ” more. In view of the Prime Minister’s estimate in May, 1942, that £46,000,000 would have to be borrowed under the memorandum of security during the financial year, 1942-43, this claim was incredible. It was in fact erroneous in both points; but it rested, no doubt, though insecurely, on some knowledge of the new agreement reached between Mr Nash, on his visit to London, and the British Government. This agreement was made public and its effect described for the first time ie the Financial Statement; and the effect is that Great Britain assumed the full cost of re-equipping the New Zealand Division in the Middle East and limited New Zealand’s further liability to a monthly maintenance charge of £400,000. This can be followed in figures. Up to March 31, 1942, debt charges had come forward to an amount of £14,230,711 stg., of which all but £2,818,000 had been repaid. But, as the Prime Minister explained in May, these figures were so low “ solely ” because claims were being presented slowly. His estimate of £46,000,000 for oversea costs, which the memorandum of security would cover and which would have to be met eventually, may therefore be supposed to have included arrears on initial costs of equipment and on maintenance, costs of re-equipment after Greece and Crete, and further maintenance. But on the new basis of assessment accepted by the British Government this obligation was greatly reduced. The re-equipment costs being cancelled and maintenance standardised on a flat rate, the full charge against New Zealand for the year was only £15,437,000, including arrears. Adding the amount carried forward from 194142, the total debt was £18,255,000, of which £8,000,000 was repaid in December. This did not leave New Zealand with “ every, razoo ” of debt discharged, nor in a position to borrow nothing more; but it did leave New Zealand with much less to pay—- £ 10,255,000— than had seemed possible, and with much smaller debt additions in prospect. A further repayment of £2,255,000 since March 31 has brought the carry-forward debt down to £8,000,000; and the estimated addition for the year is £12,000,000. Mr Nash has clarified a position previously very “obscure. He has also allowed the public to see that the British Government has enabled New Zealand to stand in a much more favourable position than was in prospect 12 months ago. The reasons why no earlier .announcement wasi made are perhaps mot very hard ,to penetrate. But whatever they were, they were reasons which should have forbidden Semple to make a claim which, qui te apart from its inaccuracy, was grossly misleading. If he had been free to use the facts (and able to understand them), they would 'have been properly used in giving credit to the British Government and to Mr Nash. He was not free to use them, and apparently not able to understand them; but he snatched a boast out of them, on the face of it a patriotic boast, in effect a political one, and in both ways indecent.