MR W. PEMBER REEVES

Hokitika Guardian, 21 August 1929, Page 5

MR W. PEMBER REEVES

REFERENCE TO THE NEW. GOVERNMENT. ' j LONDON, Aug. 12. In' the course of his speech at the annual meeting of the National Bank of New Zealand, the Hon. W. Pemeer Reeves referred to the new Gov-ernment-in New Zealand..!';:' “At the general election and licensing polling in last October,” he said, i "what may be described as a mild political earthquake led' toya Government first for 16 years. The results were the exact converse of those of the .great Presidential-election in the United States. In New Zealand a gentleman in several ivays the antitype of Governor Alfred Smith has oeen placed at Clie head of affairs and * the cause of prohibition, a signal defeat. 'i. »'»>'*• “Sir-Joseph Ward, the new,Prime Minister, is a politician of exceptional experience, .for he first took office more than 38 years ago. The Government of which lie was then a member had to face some of the chief problems '.which now confront his Ministry. Then, as now, there was persistent unemployment ; there was a demand for cheaper money to aid struggling farmers; there was an outcry ror- tne sub-division of large estates and the pushing on of settlement on the Crown lands. . Forty : \ years, ago the growth the population was slow, immigration was arrested, and there was every year an ominious feature in the number of departures, from New Zealand. All these * features have recently reappeared. The departures from our shores, indeed, have not been nearly so large in proportion,/but the rural population oijiqi side the townships has been 'actually' • diminishing. The Government, of which Sir Joseph Ward was a member in 1891 addressed itself to solve .these problems; and succeeded in doing so. We all .trust/that the present administration , may be equally successful, but-it may be, pointedout that they have now to face certain ‘ economic complications which did- not then exist. It is true that since 1890 the population has increased two and a-quarter times; that roads and railways have opened up large areas; that production is" more scientifically carried on than it then Was;.that in spite of increased cost of living the standards, of comfort and education are higher; especially,among o the' less wealthy classes';'that tfade has more' than kept,pace' .with the 1 growth of the population; and that New Zealand stands in much belter repute in London than was the case in 1891. But as against this, the Government debt hnsincreased more than six' and a-lialf t'mes, and"the municdpai v debt's~Tnore . than nine times. The State. railways are not paying their way j-the mortgage debts of the reputation . have • • 'swelled to .about' £310,CC0,000,' * ahd, . . though money is cheaper in New'Zea- v ; land than it'was in the early ’pineties most of the Government borrowing is done in London, where money for that purpose is 12 per cent, dearer than it was in 1894. .. b *,• “The New Zealand . loan/raised in that year to initiate the loans /to farmers cost the taxpavers barely.-3J per cent. I am fat from suggesting that nothing should be done tb;: help the smaller freehold farmers who have had to carry such heavy burdens during the ta c t eight years, hut it is impossible to ignore the fact that th.e external indebtedness of New ; Zealand—Government; municipal, and y../ private—is probably somewhat more than £180.000.000, and that the yearly payments on this great sum must be set against any favourable trade balance. • • • ‘ ■

“Quite !as important a difference between the old position and the present is that in the ’nineties, though .• mortgage money was dear in New 'Zealand,’ land was cheap. The Gov- . eminent held- plenty of cheap Crown , land, and if it wanted more could. j and did, buy from private owners at f reasonable rates. Now. the best of’ the puiblic .estate has gone, and it’ls, almost true to say that—after counting .the cost of, ‘breaking in’—there is scarcely such a thing as cheap land in New Zealand. The problem of pushing on settlement will, therefore,, call for all. the' skill and pati-’-once that Parliament can give it. “For the rest, the financial and public works policy of the new Gov-jU eminent will he laid before Parlia- J ment in detail during the next montlr ; ; or two, and until that is done praise ir- blame are alike premature. I tin-' derstaiul that the now Ministry lias 1 to face a deficit on the ordinary revenue of about £570,000. Then? is likewise a deficit on the State railways of about £140,000 more than last year. The term ‘deficit’ does not mean that working expenditure exceeds revenue by that sum. What it means is that the railways fail by that amount to' return full interest on their cost of construction. The operating revenue showed an improvement this year, but there was a growth of interest charges, mainly due. I am informed, to the effect ul loan conversion. The new Premier may fairly claim that these deficits are inherited rather than (brought aibout by him. He has had unusual experience . both of New Zealand finance, and of railway management, and his efforts to put tilings rigid will be watched with interest.’,’