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Hokitika Guardian, 27 May 1924, Page 2

Tub transfer of a million proposed from the surplus to the Public. "Works Fund of the Dominion is not being approved l,v the financial critics, which tact suggests that the debate on the finances will he rather more critical than usual at the coming session. Using revenue for capital expenditure hits been practised for some time in New Zealand, and the present Government »s not wholly to blame in the matter, for it is merely following a system, 'the system, however, is vicious, says the Mercantile Gazette, and should he cut out as soon as possible. When tlio community is over-loaded with taxation is not ti e time to use revenue for capital expenditure. This system lends the Treasury to shirk reducing taxation, which should have lieen done during the past two years. The system prevents real economy being effected, and further, leads to money being squandered oil public works. It is obvious that the Estimates last year were framed to provide for the transfer of a certain sum or as large a sum as possible to public works, and if the amount had been placed on the estimates, as it should have been, it would never have been passed by Parliament, and the advocates of tax reduction would have had a strong card to play. "No doubt it is necessary to continue public works in the interests of the country, but money tor this purpose should be borrowed in the open market. Taking the money from the pockets of the people for this purpose is indefensible. It must l>o remembered, also, that money is required for the development of industries and for the development of agricultural and pastoral areas, but if the Government is determined to extract £1.800,000 more than is really necessary for the efficient administration of the Government, then the other interests must suffer.

Pursuing the subject further, the writer in the financial journal just

quoted, goes on to say that producing a huge surplus, or a surplus of sonic dimensions, has become a custom with the Treasury, and some steps must lie taken to put an end to it. The matter nests with the business community, and as soon as the men in the front rank of trade and commerce net busy and show the viciousness of the principle the sooner will something be done to end it. Tlie simplest plan of deulftis with the matter is to deprive the Minister of Finance and the Treasury of the right to use the surplus, and this can be done by Parliament enacting that the surplus must he handed over to the- Commissioners, whose duty it must be to reduce taxation. Then apply the balance to the repayment of public debt. During the past year the country was obviously over-ia xcd to the extent of Cl .812,000; that is to say, that amount of taxation could have been remitted without impairing the efficiency of the Government or running it short of funds. It is of the vary highest importance just now that taxation should lie reduced, for it is imperative that costs of production, and costs of living should come down. The outlook is that food products such as meat, hatter, and cheese, will show a steady decline in values during the next few years, and the people will lie hard pushed to make the necessary readjustments without being burdened with heavy taxation. Destroy the power of the Treasury to control the surplus atAl taxation will come down rapidly.