RECORD BUDGET IN AUSTRALIA

Dominion, Volume 35, Issue 289, 4 September 1942, Page 6

RECORD BUDGET IN AUSTRALIA

£440,000,000 For War

(By Telegraph.—Press Assn.—Copyright.) CANBERRA, September 3. ' A record Budget- providing for a total expenditure- of £549,492,000 was introduced by the Federal Treasurer, Mr. Chifley, in the House of Representatives last night. Of this amount £440,000,000 is to be spent on the war. It is proposed to finance this huge sum principally by loans. Taxation and other receipts during 1942-43 will, it is estimated, provide £249,000,000, leaving a deficiency of approximately £300,000,000. No alteration in the income tax is announced, but the entertainment tax will bring in.£3,250,000 and additional , Customs. and excise revenue will amount to £14,200,000 in a full year. Details of this tax, which presumably will be imposed oh tobacco and liquor, will be announced later. The entertainment tax will start at 3d. on an admission charge, of 1/- and increase by 2d. for every 6d. by which the admission charge exceeds 1/-, up to 5/-. Above 5/- the increase is 3d. for every Cd. above 5/-. A reduction of approximately 25 per cent, will apply to ‘•fiesh and blood” shows. Deficit Of £300,000,000. This year, said Mr. Chifley, the Government faces the problem of finding £300,000,000 which is the gap between the! estimated expenditure and the estimated revenue. Excess spending power of .the people must be. transferred to the Government to pay the fighting forces and for labour and materials used in producing munitions and war supplies. ■ , - . While relying to a large extent on the voluntary efforts of the people, the Government was resolved that its pay- • went should not' be evaded, Mr. Cbifz ley said. ' Last year it received £120,000,000 from public loans. If . they, doubled that amount this year Jlicy. would receive £240,000,000, which, was four times that received in 1940-41. This would leave £60,000,000 to be provided from savings bonds and savings certificates. This was about the British rate of contributions to small savings and, with Australia’s higher j wngcs. it should, be capable of accomplishment. . Expenditure for the Army,- Navy, and Air Force would amount to £415,000,000. '■ Avoiding Post-War Chaos.

The Government had been giving close consideration to the vitally important question of post-war recons.ruction, said Hr. Chifley. The Government has accepted a recommendation of the- Cabinet sub-committee that it is necessary to invest- the: Commonwealth Parliament with, legal powers sufficiently wide to save-the nation from the* chaos which is likely to result unless.the Commonwealth Parliament is able to deal with post-war reconstruction on a national basis.: “Broadly,” said Mr. Chilley, “our post-war aim must be the physical development of our country, linked with expanded production and increased population. By these means employ- ■ ment will be assured to our people and ’security to the children of Australia. ; “Power to control prices and production is an essential adjunct to any progressive policy of physical development. Such control is possible today only because of the war powers. The present [lowers will disappear with the war and they must be continued by constitutional alterations. “The Government .therefore proposes : (l introduce a Bill to achieve the required amendment to the Constitution.” CRITICAL COMMENT Need Seen To Prevent Orgy S Of Civilian Spending ’■ ( Received September 3, 8.30 p.m.) ■L SYDNEY, September 3.

“The Commonwealth Government’s Budget for the fourth year of the war reveals a lamentable and dangerous reluctance to meet squarely the difficult duty of paying for the war,” says the in an editorial. “The treasurer has failed to put forward any concrete proposals for bridging the gap between revenue and an expenditure now greater than ever. “The Budget should aim nt recovering from the public by higher levels a 'substantial part of the flood of new spending power which is being created

each week, so as to hold in check the growth of private spending. This Labour’s financial proposals fail utterly ( to do. Fourteen million pounds of new taxes is a puny and ineffective weapon to curb tlie inflationary effects of a rapidly-growing excess of purchasing power.

“A more equitably graduated levy on incomes combined with .a system ■of post-war credits would provide the safeguard which is needed against inflation by pruning the spending power of tlie public at its source. The fact is that it is in the lower incomes that the great bulk of the spending [tower lies, and, in spite of its bold words, the Commonwealth Government hesitates before tin unpopular step. No Budget which shirks it can. be considered satisfactory.” The. “Daily Telegraph” in a leader on the Budget says that compulsory loans would be the surest and swiftest means of curtailing tlie orgy of civilian spending. There is an unfamiliar itcli to spend in thousands of war-fattened pockets. The Government' must tap those pockets-