GROWING PUBLIC EXPENDITURE

Hokitika Guardian, 30 July 1929, Page 7

GROWING PUBLIC EXPENDITURE

A SERIOUS MENACE. (Taxpayer.) Three years ago, as was stated in these columns at the time, Mr Thomas Buckland, tlic chairman of the board of directors of the Bank of Ncwv South Wales, declared that so long as the Governments and the local bodies of tho Commonwealth continued to dissipate the taxpayers’ money upon unproductive works and unnecessary services, so long would the credit of the country !be in jeopardy and the country iteslf on the brink of a chaotic trouble. Such a policy might create fictitious prosperity for the moment, he said; but it could not be continued indefinitely, and already there were some very unpleasant indication that the well of borrowing was not bottomless. Everyone knows what has happened in the Commonwealth since then.

NEARER HOME. To-day Professor B. E. Murphy, the occupant of the chair of Economics at Victoria • College, views the situation at closer quarters and with fuller information. “One of the most notable features of contemporary life” lie says “is the growth of expenditure, national and local. It is not confined to New Zenlanjd, but it is seen in all parts of the world, quite apart from .war expenditure. In most countries there is a tendency towards (a) increased taxation; (b) increased local rates; (c) increased expenditure from revenue, rtnd' (d) increased borrowing,, local and national,” This growth, the professor maintains, has Ibeen a perpetual source of amazement to economists, of distress to direct taxpayers and of perplexity to administrative officials.

SOME FIGURES. By way of illustrating the position and emphasising its perils the Professor sets out briefly what has occurred in New Zealand since 1912, when the gross national debt of the Dominion stood at 84.3 millions. In 1919 the debt had to 176.1 millions and in 1928 had soared to 251.4 millions. The gross local debt'in millions stood at 20.8 millions in 1912; and 28.1 millions in 1919 and at 64.4 millions in 1928. The total national revenue in 1912 was 11.1 millions; in 1919, 22.3 millions and in 1928, 25.1 millions. The national expenditure from revenue in 1912, was 10.3 millions ; in 1919 18.7 millions and in 1928, 24.9 .million*

PREVENTIBLE WASTE. Professor Murphy is disposed to make excuses for the politicians and the political system that have allowed the Dominion’ indebtenness to mount up, irrespective of war, as it has done since 1912; but he finally reaches the conclusion that “there is much preventive waste in public expenditure un'l that such waste is growing and should be, if possible, diminished.” Of the soundness of this conclusion there can be no possible doubt. There are many departments of the public service over-staffed; there are non-pay-ing branch railways being run at a loss of over half a, million a year theie are State excursions into business that are losing money the whole year round; there are subsidies being given to enterprises that should stand on their own feet, and there are scores of other leakages which should be stopped.

POLITICIANS DUTY. It may be, as Professor Murphy says superficial to blame politicians or polit'eal parties for these developments; but when Taxpayers’ Federation organised a 'big deputation to wait upon Mr Massey in 1922 with an appeal for a reduction in public expenditure, which had increased abnormally since the war, the Prime Minister found the mans of saving three millions in a single year. To demand that Sir Joseph Ward, with the unexpected burdens thrust upon his shoulders since he took office, should accomplish as this would be unreasonable; but the Very existence of these burdens emphasises the need ifor the utmost economy in the administration of the affairs of the country, and Ministers and Parliament wi.ll he expected to do their duty.