The Guardian AND EVENING STAR, With which is incorporated “The West Coast Times.” SATURDAY, MARCH 26th, 1921. THE WEEK.

Hokitika Guardian, 26 March 1921, Page 2

The Guardian AND EVENING STAR, With which is incorporated “The West Coast Times.” SATURDAY, MARCH 26th, 1921. THE WEEK.

Thk close of the short sessiop has been the important event of the week because of the special legislation passed in the last moments affecting financial affairs. In the interim financial statement made by the Minister of Finance (Mr Massey) it was announced that the revenue of the Dominion for the eleven months lad been £26,880.887, and the expenditure for the same period, £24,210.741. This leu a nominal surplus of £2,670.110. In tile Budget statement delivered last .July Mr Massey estimated the revenue for the twelve months of the financial year at £26,000,000 and the expenditure £23,750,000, showing a surplus of £2.250,000. With the- most important month of tile year to come, these figures tire all exceeded and Mr Massey has ventured to predict now that the year will close with a surplmi of £5.000.000. This is more titan double the estimate, and to that extent is satisfactory, especially under the present imioward financial position. But we know that the augmented surplus is due not to natural causes, hut’ to the special sum raised in Customs revenue, over £8,000,000, because of tile large excess in imports. While the hoary importations have had this advantage in saving the financial situation so far as the Government is concerned, the huge amount of money which has had to fa l sent out of the country to pay lor the goods overseas has depleted credit so tremendously as to bring about the acuteness in the money market which is the main cause of the present stringency. In other words, we cannot have our apple and eat it also. The hanking, institutions through which trading relations are carried on. have had an anxious time of late keeping their credit good overseas. Some of the hanks had large deposits in London to assist in carrying on the Dominion trade both comfortably and profitably Those credits have been melting away to pay for the goods rolling into the country. That excess of trade is now checked, and while the Dominion will not in the new financial year have opportunities to derive Customs revenue from large imports, we know also that th,. Dominion will not he drained as in the past year to pay for the goods, been use they will not be :>■ living. So the situation will have space to adjust itself.

I Mention was made in one of Mr Mas- , sey’s statements this week that the accumulated surplus fund stood at • £17,500.000. This is a repetition of the figures given in the last Budget, and ' when the next financial statement np- : pears will show an increase of several ( thousands as £150.000 is about the annual payment to th ( > fund to maintain its solvency for the purpose intended This fund is more correctly known as the Public Debt Extinction fund, and was a scheme put forward in 1910 by Sir Joseph Ward by which provision was made to repay the existing public debt within a given period. The which by opponents of the measure, at the time was laughed to ‘■corn, provides for the setting apart each vent on th t . certificates of the Controller and Auditor-General out of the Consolidated Fund, an amount equal to the sum, which, if invested at compound interest at 4% per annum for 75 years, would repay the whole of the public* debt of the Dominion as at the preceding 31st. March. Tn this manner, it was further provided that for every loan raised in the fuHipfi an tiddiUopal propor-

tional amount will be contributed to the fund to enable such new loan to be extinguished at the expiry of 1 5 veais from the date of issue. After March 31st., 1915, the interest instead of being calculated at 4% was 'fixed at the actual average net interest earned b\ the funds invested under the act, during the previous three years. I his fund is administered by a Board and must he invested in loans to settlers to workers and to local authorities. It is expressly forbidden to invest any of the moneys in Nt'w Zealand Government securities. There are other safeguards to secure the principal for ‘tiecial investments only and to sec that at all times the money available is applied continuously to interest earning purposes. In this way improper use of the accumulations is prevented, continuity is preserved and by automatic action the total debt at any given .date will be extinguished in 7q, years from such date. The investments have been as high as £171,000 per annum, hut it is a thrifty way of using ; the money, and the way the acciruu- ! lotions have grown already is an indication of what can he accomplished ' In ten years £17,500,000 have been created and year by year the principal will grow more rapidly in substance. It is a far seeing scheme with a fine ideal behind it.

Thk remedial legislation put through so hurriedly by Parliament is being viewed from various standpoints. The measures taken will lead to the locking up of very considerable sums ol money, and that is not desirable altogether, when money is growing dear":-, for the action will tend to make money dearer still. The Government acccssa ily must take the consequences of its action, which of course would he done on the host advice available. To what extent the step will stabilise finance remains to b t > seen. If it lias a general effect in curtailing extravagance and imposing economy, the ultimate result will he good. Probably it reqin -d something more impressive than ticspoken wopd of advice to bring home to the people as a whole, the necessity for taking all possible precautions to retrieve the financial position. Certainly in th t » brief debate on the measure, the Prime Minister was explicit enoiign as to tin 1 need for the bill, and the House accepted his lead in the matter. The experien've should bring home *o the Government as to the people ill • great need there is for curtailed expenditure On the face of it. without remedial measures to balance the outgoings against the income of the country. the position cannot improve within the next year. The price for our staple production —wool is now b«pl«' v pre-war rates and till world conditions permit the price to advance the fin.m cud position must remain stringent. It is highly essential, therefore to curtail expenditure, and practice economy. New Zealand's national expepdit mi " nowadays is made up largely of interest payment and loan redemption. A hug.portion of the principal sum went in war expenses and the money was not repro-

ductive as in the case of public works. Also, the heavy borrowing for war purposes tended to increase interest rates so that abnormal expenditure results. ILit in other directions there must ho drastic curtailment. Even the Customs would show a deficit. Next year that source will not yield the same substantial sum. There will he a big decline there and in other sources also—income tax for instance. It is highly important. therefore to enforce rigorous reductions or financial difficulties will become very acute indeed.

Thk remarks by Mr Storey, Premier of New South Wales, at the Colonial Institute in London, as conveyed by a recent cable, indicates the same spirit which is beginning to pervade the ranks of Labour, whence the extremist is being excluded. Air Storey is at the head of the Laltfhir Government of the Mother State, and holds a, position which qualifies him to speak with authority when criticising Labour aspirations generally. The yoke of office may have had a restraining influence on the gentleman in question, and do’ii lit less li is experience and difficulties iy responsible office have brought him much enlightenment as regards the relations of capital and labour, and particularly in reference to the service a citizen owes the State where he is domiciled. Mr Storey, speaking at Home just the other day said there was only one way to carry reforms, and that was to educate the people lip to the justice of them. This is tantamount to saying that, a. community cannot lie dragooned by strikes or other tonus of direct action to submit to the unreasonable demands of a section or class. Air Storey realises that the industrial situa tion in England so far as the leadership of Labor is concerned, is amazing, and his remarks suggest that Labor is being very badly led—the instruction lacks the same methods which should prevail. Air Storey makes a definite pronouncement in favor of arbitration as against strikes as the safer road to reach the objective. He believes (and this seems to ho a < onelusion arrived at long ago by the average onlooker), that the agitator class of leader who is continually fermenting trouble is the real enemy of Labor, and it would he better for the industrialists if these agitators who found an occupation in directing the round of strikes were hurried hack to real work, and relieved from their present harmful occupation. Tt is more than refreshing to read sane opinions along these lines being uttered by Labor leaders themselves. It is hopeful indeed and is a. sign that in the ranks of Labor there is a. very useful leaven at work, and the result cannot but he beneficial to the industrial world at large.

There was another interesting and instructive piece of cable news this week this time from -America,—which showed that at heart the great nation beats in unison with the late allied comrades of the Great War. The New York rally to oppose a, pro-German expression of opinion a little earlier was quite a remnkablo affair. It was another instance that deep down in the heart of any intelligent community there is the sense of right and reason which will guide those people to do the proper thing in the time ot crisis. It is an old-time shibboleth to trust the people as a whole, and judging bv what happened at the Mnddison Square gardens, there is a great public sentiment rampant in the United States which is not to he denied should the coun-

try be called on to fac-o an extraordinary situation, in addition to an enormous attendance, thousands • of people were turned away. The speakers were continually cheered when they declared that the true American was bitterly resentful of attempts by hyphenated Americans to cause friction between the United States and the Allies. General John Pershing said America must insist that outlaw nations he held to their full responsibility and pay the penalty for their misdeeds. He declared: “We object to loreignborn persons, whether German or Irish, attempting to decide America’s questions for foreign reasons.” There is something of the nature of throwing down the gauntlet about this, and it certainly indicates that between the English’-speaking peoples on both sides of the Atlantic there is a bond ol friendship and union it will be impossible to sever. There is a lesson to bo drawn from the American action also, and that is that at times it is necessary to stand up resolutely lor the cause of Empire or a country’s lintioanal interests. Then* may be and are differences of opinion in regard to various national affairs, but at heart the people as a, whole are loyal to their country nncl would not permit any overt act to jeopardise all that they hold so dear—their national freedom and th« security of their country.

Thehe was an intecsting discussion at the Progress League, meeting the other cvening°whi"h indicated a. keen desire to help the farming industry of Westland, by providing means whereby young farmers, and particularly those of the soldier class, who are taking u]) farming pursuits, could obtain special instruction on scientific lines, m regard to their operations. The trend of the discussion went, to show that in the production of fodder plants alone, the farmers have much to learn in the way of securing the best results from what is grown on their holdings. If it is a matter of producing grass, it is as well to grow that giving the best results from the locality. This can bo arrived at in the mean by observation, and then effective and more intensive cultivation. Bringing the farmers together and exchanging views is of course helpful, but there is required also some basic knowledge as to > the scientific side of plant life .and growing. The operations of the suggested winter school would bo in that direction. Tt would give the young farmer some “extras” as it were? which cannot always be picked up by experience except, at great cost. Experience teaches, but it is a slow and expensive method of learning, and winter classes under experienced lecturers would lie a much shorter cut fo the student. The movement is one which should have a general supjxirt from those going on the land': ft will be an opportunity t 0 pjck up useful information first iiaiid in ail inexpensive way. It might he said that conditions in Canterbury are so different from those in 'Westland that there is not a great deal to leain from outsiders. But the foundation of it, all, is the scientific side, and the laws of nature operate just the same in Canterbury as they do in Westland, and it is as well to begin to understand those laws first hand through the channels of a scientific lecturer, rather than working in the dark and discovering them by a slow process in the school of hard experience. The project is well worth encouraging hv those interested.