FINANCE IN AUSTRALIA

Hokitika Guardian, 14 February 1931, Page 6

FINANCE IN AUSTRALIA

M R SOFLLIX’S REVIEW. i BTATEM EN'l' TO PREMIERS' CONFERENCE. SYDNEY, February 6. Although Australians have been diverted temporarily from their troubles by the deplorable happenings this week in New Zealand, they are again beginning to wonder when the heavy pall of depression which hangs over the Commonwealth will show signs of lifting. Every Government of every State is looking to the Commonwealth Government for a lead. Every citizen of every State awaits anxiously some tangible pronouncements which will’ afford work for breadwinners, and relief from an intolerable economic depression which threatens to develop into something more sinister. Action by the. Commonwealth Government in the direction desired began early this week at Canberra with a conference between the Prime Minister, Mr J. H. Sculliu, the Treasurer. Mr E. G. Theodore, and Sir Robert Gibson, chairman of the Commonwealth Bank. Their conversations concluded yesterday, and now a conference of the various State Premiers and Treasurers has begun at the Federal Capital to consider the Uiree-vear plan for the financial rehabilitation of the Commonwealth. A HITCH ALREADY. Reports arriving from Canberra indicate that there is already a hitch, both Mr Scull in and Mr J. T. Lang, Premier of New South Wales, declaring that 'they will not consider ,anv plan involving a reduction of wages or the standard of living. The Prime Minister, addressing the Conference on National Finance, reviewed the heavy fall in the value of exports, and the terrific growth of unemployment. He said that the Governments of the States and the C oinmonwealtli were faced with the task of meeting a very serious budgetary position. He estimated the Commonwealth deficit for 1930-31 would be •£10,000,000, and that of the States £5,000.000. He feared that th 6 position in the following year on tlve basis of present conditions would be 'even worse. THE NIEMFYER AGREEMENT. * Mr Seullin emphasised that although the Commonwealth Government was a party to the Niemeyer agreement bv which the Budgets must be balanced, it had been impossible to honour fh r agreement, because of the immense decline in customs and excise and other sources of revenue. “The task t<> which we set ourselves was too great for immediate accomplishment.'’ lr said. The Federal Government’s commitments for the year were as lollows : ! £ Interest and sinking fund 23,000,00 b Exchange ' 3,000,001 War, invalid and old age pensions 20,000,00 b Defence 3,000,000 Payments to States .12,500,000 Public utilities 11,000,000 .Ordinary departments and miscellaneous services 0,500,000

Total 79,000,00; Turning to the Government's ioai debts lie said the short term indebted ness of the Commonwealth and States by way of overdrafts and treason bills at the end of this month was estimated at £55,500,000, of whin' £38,000,000 was owed in London, ant. the remainder in Australia. At the present rate of exchange the problem of meeting overseas liabilities involved the payment of an extra £10,000,000. DEDUCTION OF INTEREST KATE Mr Seullin urged the conference to turn its attention to the reduction pi the interest rate on future loans am' added 'that "the essential need at the moment was a revival of industry' in order to provide work, which would naturally lighten the task of restoring Budget equilibrium. Shortly alter the conference got down to business (lie Prime Minister astonished the delegates by declaring that the committee of financial experts who drew up a plan for submission to the conference had no right to make recommendations, but were merely required to collect data and statistics for the information of those present

OFFICIAL SUMMARY OF OBLIGATIONS. TOTAL OF £374,000,000. SYDNEY, February 6. The following is the official summary of the Commonwealth and State heavy financial obligations totalling £374,000,000, during the next three years: £ Commonwealth and States maturing debis ... 160,000,000 Treasury Bills on London 10,000,000 Short term indebtedness on London 30,000,000 Short term indebtedness on AUSTRALI Australia 9,000,000 interest bill on London for three years ... ... 82,800,000 Interest bill on Australia for three years ... 82,200,000 Total 374,000,000 Well-informed circles say it will bo impossible to repay the loans out of | the funds derived from additional taxation, and therefore that further l>orrowing is necessary, which will only be possible by a restoration of Australia’s credit and lower rates of inter eSt»