THE FINANCIAL POSITION

Dominion, Volume 8, Issue 2288, 23 October 1914, Page 4

THE FINANCIAL POSITION

. 4 _- The very cheerful tidings concerning the country's finances which tho Ministeh of Finance was able to place before the House of Representatives yesterday is hut another testimony''to the sound and prudent administration of; tho finances by tho

Reform Government. Thanks largely to the care exercised and the foresight shown by the Hon. J. Allen, war, with all its disturbing influences on the money market,' is not going to seriously affect our public finances for some time to come at least, which is a matter for sincere congratulation. Ministers arc' in a position to* continue tho supply of funds for settlors and workers, and thn Aw*, jrisouf of the crtoia h.'is >iU

eminent is now in a position to make i some small provision also for tho 1 financial requirements of local au- i thoritics who have had to be left for i a brief periodto fend for themselves, -i It has been found possible to increase '. the maximum loan which may bo 1 granted by tho Advances Department '. to a settler or worker desirous of i building a home from £350 to" £400, j while-the maximum loan to settlers : for expenditure upon improvements : is to stand meantime at £500. In ad- . dition the embargo upon loans to i local authorities has been lifted and they may now obtain advances not exceeding £1000. Sib Joseph Ward's , assertion that to some local authorities so small an advance will be of no use at all displayed an unfortunate narrowness of vision which is coming to be regarded as characteristic, and is sufficiently met by Mr,. Allen's sensible retort that something is better than nothing. As the Minister pointed out the advance, small as it is,, will enable many local authorities to take up £'for £ and other subsidies allotted to them on the Public Works Estimates. This should have a decidedly stimulating effect upon the demand for labour while the advances to workers and settlers for the erection of homes should provide a good deal of work for carpenters who are said to have felt the pinch of unemployment more severely than workers in most other industries. The figures epitomising the operations of the Advances Department during the month of September speak for themselves in a fashion to silence the criticism of even the most irresponsible of the noisy group of fault-finders-on the Opposition benches. Loans paid over to settlers during tho month (including those made frofn the Advances Office and Public Debt Sinking Fund Accounts) totalled no less than £136,290, and during the month additional loans to settlers, totalling £38,165, were authorised. - In the same period an aggregate sum of £30,135 was paid over to workers and new loans totalling £14,740 were authorised. This is a record of _which any Government, in the circumstances, might be proud. - Still greater importance attaches to the facts which the Minister wa& able to make publio in regard to -obtaining future supplies of loan money: It is here of course that the pinch of war is most directly felt. The ordinary channels of borrowing are closed meantime and the only available method of raising money, is by the issue of Treasury bills. The 'Government has 'borrowed from the Bank of England in this way a sum of £400,000 for war purposes. Tho loan has a currency of only six months, but highly satisfactory arrangements have been made for its renewal, tho Imperial Government having agreed to include in a projected loan a sufficient "sum to repay advances obtained by New Zealand from the Bank of England. Fettered by a stipulation imposed by tho Imperial authorities, Mr. Allen was unable 'to make ■ known the rate of interest, but he hinted that the money' had been ob-' tained on better terms than the recent New South Wales loan raised at 5£ per cent., and he declared confidently and without reservation that no other Dominion/had made more satisfactory financial arrangements. Guardedas it was in some respects,' the Minister's statement was throughout so optimistic in tone as to warrant a belief that no excessive difficulty will be now experienced in obtaining further supplies .for current requirements. For this satisfactory state of affairs and all- . that itMmplies New Zealand is, of course, indebted in part to the Imperial authorities, but a. factor of . at least equal importance is the prudent and far-sighted financial administration which placed the finances of . the country in times of peace upon ■ a thoroughly stable footing so that \ they are now in the best possible con- '. dition to' meet the difficulties and I limitations incidental to a state of ' war.