WELLINGTON NEWS

Hokitika Guardian, 31 October 1925, Page 1

WELLINGTON NEWS

STATE FINANCES. (Special to “GuardH.n”.) WELLINGTON, October 28

No one will accuse the Minister of Finance (Hon AV. Nosworthy) of being an economist or financier, and his knowledge of cameralistics must be quite insignificant. When he makes a speech on State Finance it would bo safe to assume that he is merely repeating a Treasury Statement specially prepared for him. In his opening address in the present campaign he dealt with State finance in the light of treasury opinion. There was the usual camouflage about the public debt and a disclaimer about reckless borrowing, yet wo have this glaring fact that in 1923 the Government borrowed in London .£5,000,000; in 1921, it went one better for the amount borrowed last year was £0,000,000. This year in .May last the Government borrowed £7,000,000, but this of course is not reckless it is just moderate borrowing. This is not all, for the Government is now trying to raise millions in the local market but with little hope of success. . There is the usual dissection of the productive and non-productive loans, and according to the Treasury £118,000,000, is a dead weight of which £2,800,000 has boon spent on public buildings, immigration, etc. This leaves about £110,000,000, as interest bearing, the inference being that tho taxpayers aro not burdened with tlie interest on the latter amount, which is not true. The railways for instance do not earn more than 3;j per cent, and the average interest on railway capital expenditure must he quite -I nor cent. Furthermore, tho hydro-electic instalations arc not paying the interest on capital expenditure, and it is doubtful whether some of them will ever do so. Debt charges for the past financial year amounted to £10,100,000, and because the whole amount was not met out of taxation, it seems, according to the Treasury, that the people should be grateful. It must not be - forgotten that, it is tho same small population of 1,300,000 who had to find the whole of £10,100.000, and nearly £5,000,000 of the amount was tho savings of the taxpayers. Then with regard to State Advances, tho Treasury figures show that sinco March Ist, 1923, the value of loans paid over for all purposes was £11,329,021. How much of this is going to prove a dead loss to tho country. Neither private individual nor the State can lend up to 75 per cent of tho value of country property in boom years without incurring loss. No private individual or money lending institution can follow the Government in this wild-cat scheme. There must be heavy losses, and those losses will fall on the taxpayers and not directly on tho Treasury officials or tlie Minister of Finance. Then with respect to the surpluses, these have totalled approximately £26,000,000, which represents so much money plundered from the taxpayers. About £18,000,000 of this went for Soldier Settlement, Bank of New Zealand shares, etc, and as we all know about £2,500,000 of the amount spent on Soldier Settlements has “ gone AVcst.” The £2,600,000 spent on public works should have come out of loan and not out of taxation. About £5,300,000 was used for debt extinction and this was tho only honest uso made of the surplus. The time is fast approaching when very drastic changes must ho made in our system of public finance. AVe must follow more closely the British system ; if wo do that tlie Treasury will require to he much more circumspect in its methods than it appears to he at present. Manufacturing surpluses by tlie system of under-estimating revenue and over-estimating expenditure is frenzied finance and a despicable method of plundering the taxpayers. The Treasury must he made to realise that the taxpayers—the earners and savers —know best how to handle their own money and do nob want the I roasury lo invest it for them. THE BASIC AVAGE. .Most, Parliamentary candidates and particularly those in the Labour ranks, have a good deal to say about the basic wage. Four pounds a week is not enough lor a man to maintain his wife and family, and it is doubtful whether £6 per week would he. sufficient.. Every advance in the' basic wage forces up the prices of commodities, and the basic wages lags behind that: is, it never gets up to tlie cost of living. The trouble is that wo are all thinking in terms of currency instead of in terms of commodities. II seems nice to he able to say one is earning £6, £7 or £8 per week, hut the real value of the money is not the number of pound notes one receives hut what those pound notes will buy in food, clothing, etc. The attack should lie on the cost of living and not on the basic wage, which would he quite reasonable if commodity prices were reasonable. Many, if not most of the commodities of daily use. in fact what may he called the necessaries of life, are made artifically dear hv the Customs tariff, or by the vicious Ordor-in-C'ouneil. Our daily bread for instance is absurdly high by order of the Government. There is unquestionably profiteering in many lines of goods; even in tho food lines that are produced in excess in the Dominion. House rent is high l)ecause the Government has forced private enterprise out of business. The State and the local bodies are building houses for sale, there are hundreds of families who want houses to rent and there is no one meeting their requirements. The problem is economic not political and the attack should he on the cost of living which can and should ho materially reduced.