CRITICISM ANSWERED.

Manawatu Herald, Volume XLIII, Issue 2235, 5 February 1921, Page 3

CRITICISM ANSWERED.

FINANCIAL POSITION OF THE

DOMINION.

STATEMENT BY MR. MASSEY.

Auckland, Feb. 3. Taxation and'criticism of’the amounts being levied in New Zealand at present were dealt with by the Prime Minister at a luncheon tendered to him at Pukekohe to-day. The principal adverse criticism levelled against the Administration, he said, was that the Government was sinning by increasing taxation. He wished them to try to recollect one instance in which increased tax-

ation collected. After referring »to expenditure, Mr Massey .• said that more money would be re.quired, though he did not know when it would be needed. It would be necessary to go on to the open market for it. The money would be .needed for roads, bridges, hydro-:, electric power, education, and for numbers of other purposes. The country had got on very well with the reconstruction problem, and had nothing to complain of at present. Criticisms coming from a New Zealander in London recently had declared that unless great care was taken the country would he faced with bankruptcy. There were two words which citizens of New

Zealand should never use: one was “repudiation” and the other was “bankruptcy.” There was not the slightest fear of either. A\hen the

Imperial requisition came to an end

there had been a sort of interreg,num, during which money was not coming. It had scarcely begun !o come yet, and it would not come with the same promptitude as under the requisition. In a way, he would

like to see another requisition, if it

would come without war. It was the best thing which had ever happened for New Zealand. Another factor to he considered was the increase of imports from England. The consequence was that Customs duties had been coming in with a speed that had never been equalled before. Two years’ Customs duties had been collected in one. year. This could not be maintained. While this year’s returns would be far above the average, next year's would he proportionately below the average, and it was of next year that he had to think. He had to set aside a reserve to tide over this period.

lie hoped that when the next financial year came to an end the public accounts, or Financial Statement, would show that there had been a very considerable saving on tile part of the Treasury and different Departments. Reference had been made to the £15,000,000 of accumulated surplus, and it had been suggested that the Government had wasted it. That money had been spent oil placing soldiers on the land and finding homes for them. The greater part of it was earning 4 per cent. The Government had either to fake*it, to borrow other money, or to break the country’s word to the soldiers. If the money had been borrowed it would have cost 5J per cent,, and would have required a sinking fund of I per cent., as a war loan. That was only one item. The next Financial Statement would show that there had been a saving all round.

He insisted that Hie country was absolutely sound. No country could he sounder. Roughly, the war debt and ordinary debt amounted to £200,000,000. There were assets for everything except £60,000,000, The difficulty was during the next 18 months to get revenue to meet the accounts.