DOMINION FINANCE

Hokitika Guardian, 14 August 1931, Page 1

DOMINION FINANCE

LONDON BANK’S VIEWS. In its Monthly Review, . Barclay’s Bank makes the following reference to New Zealand finances: “In connection with the recent flotation in London of a new loan for theGovernment of Now Zealand; sumo interesting statistics o,n the finances ol the Dominion were made available. New Zealand has been unable to escape the economic depression that has affected all countries pfi the world, particularly those mainly producing primary products, while her difficulties must have been aggravated by the deplorable earthquake which caused much damage and loss of life in the Hawke's Bay district. The present economic situation in the country lias necessitated a reduction in the Government's programme for capital expenditure irr the Dominion during the current financial year by about 40 per cent, compared with 1930 31.. All Government wages a.n,d salaries have been reduced bv 10 per cent and other drastic economy measures are being undertaken in order to balance the Budget for the present year. For the twelve months ended March 31, 1931. the ordinary revenue account resulted in a deficit of £1.6 millions, due mrtinly to the unexpected falling off i" revenue during the final quarter, arising out of the world-wide decline in' prices. Budget defects, however, are a rare occurrence in New Zealandonly two others having been experienced since 1892. In the pre-cut case the amount has been made good from the balance of accumulated surpluses since 1914, totalling about £3O millions:” After analysing the National Debt, the Review continues:“An indication- of the faith of the inhabitants of New Zealand in the future of their count r v is afforded b v the fact that on March 31. 1931. about 42 ner cent, of the dotal Public Debt was domiciled in the Dominion, against only 17 per cent in 1914. “The present world trading denression and the fall in prices have placed a severe strain on the agricultural countries of the world, many of which are new territories in process of devdlnnment. Fortunately. Now Zealand eniovs a good financial reputation, which should assist her recovery, when trade conditions generally improve.”