DOMINION ACCOUNTS

Hokitika Guardian, 5 June 1929, Page 6

DOMINION ACCOUNTS

PREMIER’S REVIEW. LAST YEAR’S DEFICIT. (By Telegraph—Per Press Association.) WELLINGTON, June 4. The national accounts were reviewed by the Prime Minister in a speech in tlie Town Hall to-night. The revenue and expenditure of the Consolidated Fund for the last financial year, he said, had. now been audited and, as was previously announced, the deficit oil the year’s operations amounted to approximately £577,000. • Sir Joseph Ward said that, to be exact the revenue amounted to £23, 599,470, and the expenditure to £24170,928, leaving a deficit of £577,252. the estimate for lasi year was v.-'-y close, tlie anticipated revenue being set down at £23,808,250 against a:i appropriated expenditure of £23,806,522 leaving an estimated surplus of only £2728- As. the actual results showed a deficit of over £677,000. it would be seen that the pmvi&i'on-made had failed to meet the position to the extent of £580,000.

“In analysing- figures, to arrive at the principal causes of this discrepancy,” Sir Joseph continued, “I woii’i" first like to say that the receipts from tlie Special motor taxation for highways purposes exceeding the estimate by about £90,000, but as this class of revenue is automatically paid out to other accounts, it does not assist the Consolidated Fund; and the position of last year’s accounts will I think, he more easily understood if these compensating increases are eliminated. Setting aside such items, I find that in round figures, the causes of deficit are as follows : Shortage in estimated revenue:— £360,000. Excess over estimated expenditure—•£22o,ooo. “This makes a total of £580,000. which, less the estimated surplus of £3OOO, leaves the actual deficit at £577,000.” “The revenue shortage is due to the fact that, with the exception of stamp duties, the yield from, the principal items of taxation did not come up to expectations'. Customs, which is the mainstay of tlie revenue; fell short of the estimate by £307,000. This largely was due to a falling off in the duty collected on spirits. Then the income tax was short iby £89,000, and the land lax by £IO,OOO. Tlie former, of course., is "It reflex of the tardy recovery of the trading position; while the drop in the land tax is the result of an adjustment of the country valuations and of subdivisions. The beer duty exceeded the estimate by £11,000.. and the interest on railway capital by £76,000; hut, on all of the other items, there was a net shortage of. £41,000, ‘the outcoiiie being a shortage of £360,000. in the total revenue.”

“ On the other side of the account, the net increase in expenditure is made up of an excess expenditure under permanent appropriations of £310,000, which partly is offset by a saving of £OO,OOO under the annual votes. These annual votes consist for the most part of salaries and other administrative expenses oi the public service, and the saving of £OO,OOO, without curtailing the service of people,, represents the fruit of the Government’s, careful control of expenditure, lhe expenditure under the permanent appropriations, however, is much wane rigid, and, for the most part, is outside the scope of administrative control. This class ,of expenditure consists of interest; subsidies to local bodies and to hospitals, pensions, and similar payments fixed by Acts ol 1 aili'ament, of by definite contract. “Of the £310,000 excess of expenditure Over the estimate for permanent appropriation's, £136,000 'is accounted for in interest charges. In this connection a change in the interest dates, arising out of conversion opciations, iii London, has entailed the payment of interest for a broken period of four months, amounting to £156.000, which interest in the ordinary course would not have been payable until. this financial year. The balance of the excess of the expenditure, was spread over nuin'erous items, among which mention might be made for the follow-, j n o- ; —War Pensions £38,000, Old Age Pension £29,000; losses on branch railway lines £11,000; and the Somoan Police force £25,000.; the last being an. entirely ne witem.”

“From what 1 have just stated it will lie realised that the increase in expenditure comes from items that cannot he curtailed. In connection with interest,' I must point , out that, the London conversions of the four per cent consolidated stock, when carried to completion hy November next, will inevitably lead to further inci oases in the interest charges, and the whole operation will mean a permanently increased charge of about £22,000 a year. This, with the normal increase for social services, such as education, war pensions old age and other pensions, has created an expenditme that cannot lie reduced.” “A reputation for ha,lancing its budgets, is a very considerable factoi in the Dominion’s high standing financially, and to safeguard this, the present position must be rectified without delay. The REVENUES aRE INADEQUATE. to meet the increasing charges that T have referred to, and the .Government woilld be failing in its duty if it did