FINANCIAL STATEMENT.

Manawatu Herald, Volume XLV, Issue 2602, 5 July 1923, Page 3

FINANCIAL STATEMENT.

DELIVERED IN HOUSE TUESDAY EVENING. SUBSTANTIAL SURPLUS SHOWN. . Statement was delivered in the House of Representatives on Tuesday evening by the Mininster for Finance, the ” on - TV. F. Massey. In the course of his statement he said : I have the honour to submit the annual statement of the finances of the Dominion as at the 31st March, 1923, and in doing so desire. tc» congratulate the committee upon the satisfactory position of the Consolidated Fund, Ordinary Revenue Account, which at. the end of the year disclosed a surplus of revenue over expenditure amounting to £1,315,683. " This gratifying result is attributable to the general improvement in the condition and prospects of the Dominion, brought about principally by the revival of the overseas demand for our produce and by economical administration. CONSOLIDATED FUND: ORDINARY REVENUE. Revenue.—The estimated revenue for the year 1922-23 amounted to £26,250,000, whilst the actual amount received was £27,579,443, or. £1,329,443 above the estimate, and £547,564 less than that collected during 1921-22. The principal increases were as follow: —Customs, £936,856; beer duty, £153,230; stamp and death duties, £136,787. The main increase in Customs duty took place during the last five months of the year, and is due to the change made in the tariff in November, 1921; to large importations of soft-goods during t.he ■March quarter; and to the duty collected on alcoholic liquors and other luxuries. The following increases are attributed to increased rates of duty; Tobacco, cigarettes, etc., £277,738; tires for motor vehicles, £61,135. Increased importations of apparel, drapery? textiles, boots, and silks account for increased revenue totalling £657,724. Another source of increased revenue has been the extra, preferential duty levied on foreign goods; for example, ootton piece-goods, increase £19,892; tools, £9,800; sewing-machines and typewriters, £3580. The gross increase in Customs duty amounted to £1,028,869; but after deducting decreases due to the change in the tariff and in the revenue collected on spirits, the net excess is £936,856. There was a decrease of £2,267,369 in land and incoino tax, and in this connection I may explain that in 1920-21 the total tax collected was £9,937,923; in 1921-22, £7,640,803; in 1922-23, £5,373,434. Expenditure.—The total expenditure out of the Ordinary Revenue Account amounted to £26,263,760, being £2,203,078 under the expenditure of the previous year, and £1,851,946 less than the amount appropriated by Parliament. The expenditure under the three main heads was as follows:—Civil list and special Acts, £4,073,957; interest and sinking fund charges (including £141,171 paid off debt on account of Imperial funded debt), £8,899,957; annual appropriations, £13,289,846; total, £26,263,760. Compared with the previous year the decreases are: —Civil list and special Acis, £357,926; annual appropriations, £2,302,831; gross decrease, £2,660,757; less an increase in the interest, sinking fund, and repayment charges of £457,679; leaving the net decrease as mentioned above, £2,203,078. Result of the year’s operations, 192223. —Balance brought forward, Ist April, 1922, £7,531,367; revenue, £27,579,443; expenditure, permanent charges and appropriations, £26,263,760; leaving a surplus of £1,315,683; total, £8,847,050. Deduct— Payment to Loans Redemption Account for redemption and cancellation of securities, £3,159,960; transfer to Discharged Soldiers Settlement Depreciation FuncT, £50,000 £3,209,960; balance at 31st March, 1923, £5,637,090. Whatever may be said to the contrary, the country is making a speedy recovery, and the upward movement is increasing in strength and confidence. 1 believe we have reached the end of the period of unrest and uncertainty; but, although most of our temporary difficulties have been surmounted, conditions are still far from normal, so that continued prudence is necessary. The sound financial position that we have attained should therefore be regarded as affording an opportunity to lighten the burden of taxation and to relieve industry and commerce, rather than an indication that stringent economy and good management, may bo relaxed. Economies!. —Last year when Hutlmwg the progress of the economy policy initiated early in 1921 I gave an estimate ot further expected savings, and stated that in departmental votes and under special Acts, the gross savings, with other proposed economies, were expected to amount to £4,028,863. The figures for 1922-23 show that, with the savings effected last year, the reduction over the period referred to amounts to £3,735,049. ihe scope for effecting economies is limited, and further savings in expenditure at this rate cannot bo looked for if the services o the country are .to be efficiently maintained and adequate provision made for growing needs; nevertheless, the practice of sti ct economy continues to be imposed oil dePa Accumuiated surpluses.—The balance of accumulated surpluses brought forwaid on the Ist April, 1922, amounted £7,531,567. Included m this sum was £2,129,420 of excess Customs revenue ’ received m 1920-21 which was reserved to meet in* anticipated fall in revenue. This reserve was utilised during the greater portion of the year but when the effect of economy was felt in the reduction of expenditure and the revenue came in, the necessity for this reserve disappeared and the amount was restored to the Aeeuniulat d Surpluses Account. PUBLIC WORKS FUND. The expenditure upon P ljl >b c worts amounted to £3,912,886, or £1,548,521 less than the expenditure for the jeai 1921-22. FIVE PER CENT BRITISH WAR LOAN STOCK.

The amount of this stock, redeemable at par but purchased for investment purposes at £95 and held by the diflferent accounts at 31st March, 1923, totalled £2,570,000, nominal value. The price quoted on the market at that date was £lO2. As the purchase price was £2,441,500, this represents profits on the transaction amounting" to £179 900, less accrued interest for tour months inoluded in the quotation piice, leaving a net investment profit oi £13 I, oho, in addition to the interest earned at 5 per AND RENEWALS.

The loans which matured during the year amounted to £9,004,986, to which must be added £8975 matured loans for which debentures had not been presented up to the 31st March, 1922, making a total of / £9,013,961. Of this sum securities amounting to £2,431,695 were redeemed and £6,576,706 renewed at rates of interest varying at 4to per cent. In addition vO the redemption of securities at maturity as above, other securities totalling £6 034,506 were, redeemed as under: In terms of section 24 of the l'inance -lct, 1921-22 (before maturity), £5,893,335; funded debt, £141.171., £6,034,506; .making■ n total of £8,466,201 redeemed during the year ‘ TREASURY BILLS. It vr&s not necessary" to issue lreasury bills in anticipation of revenue until the / Ist November, 1922, and then only to t-lie 1 extent of £250,000. The bills were paid oft i by the 31st March, and none were cmtstandV ing at the end of the financial year. I CUSTOMS AND EXCISE. Revenue, 1922-23. —Estimated, £5,810,000; amount. realised, £6,769,873; compared with estimate, £959,873 in excess. IMPORTS AND EXPORTS. The values of the imports and exports for the past three financial years are as follow : Imports.—l92o-21 £67.463,269; 1921-22, : £35,986,060; 1922-23, £37,112,779. Exports—l92o-21, £48.219,672; 1921-22, £43,794,883; 1922-23, £45,548,700. An analysis of- the value of goods re§arded according to origin shows lat the proportion received from Great Britain is 52.2 per cent of the total, as against 48.5 per cent last year and 51.5 per. cent in 1914. The percentage on the same basis received from the United States -was 15.4, as compared with 11.6 per cent in 1914. ESTIMATED CUSTOMS REVENUE FOR 1923-24. The usual inquiries have been made from the banks, and from merchants. An optimistic feeling prevails, and there is reason to expect that the imports for the current year will show an increase over those of the year just closed. The increased prices realised for our primary products abroad, and the good prospects for the immediate future, nave caused merchants to increase their orders. The extension of the preferential tariff in favour of Great Britain and the reciprocal agreement with Australia are also bound to cause some increase of revenue. The estimate for the financial year 1923-24 is accordingly set down as under:—Customs revenue, £7,000,000; excise beer, £750,000; timber export duty and other receipts, £7OOO. Total, £7,757,000.

INLAND REVENUE DEPARTMENT. LAND TAX.

The land-tax receipts compared with those of 1921-22 show a decrease of £96,314. The comparison is as follows: —1921-22, £1,637,816; 1922-23, £1,541,502; decrease, -£96,314. INCOME-TAX.

As compared with the receipts for -92122 the income-tax received in 1922-23 shows a decrease of £171,055, as 1921-22, £6,002,987; 1922-23, £3,831,932; decrease, £2,171,055. The decrease in the income-tax is due to the large shrinkage in the income of taxpayers generally, and to the removal of me super-tax of 20 per CeUt STAMP AND DEATH DUTIES.

The. net revenue derived from stamp and death duties was. £3,581,291, or £855,291 in excess of the estimated receipts. The increase in the death duty is due to the operation of the provision of the Act of 1921 to charge interest on duty unpaid on the estate of a deceased person after three months from the date of death, which has resulted, in the early payment of duty. When the Act came into force on the 22nd December, 1921, there were many estates of - persons who died prior to that dale in respeot. of which duty did not beconie liable until- after the 31st March, 1922, so that in the year 1922-23 more than a year s death duty was collected. Portion' of the decrease in adhesive stamps is accounted for by crediting Court fees and other fee 3 collected by means ot stamps to the respective departments, under the heading of “departmental receipts. These have hitherto been included in stamp revenue. The estimated revenue for the current year is £3,364,000. working’ railways. The gross receipts from w'orking railways amounted to £6,727,802 an increase of £84,211 on the previous year’s figures Ihe working expenses amounted to £5,502,497. The net revenuo is therefore £1,225,305, representing ft return of £3 0s lOd per cent on the capital cost. The actual revenue receivecl was £27,802 in excess of the ostimate. It is estimated the revenue for the current year will be £7,000,000. POST AND TELEGRAPH DEPARTMENT. The net amount of revenue collected by the department during the year was £2,705,030. The principal items were— Postages, £1,289,496; telegrams, £699,444j and telephone exchange receipts, £595,96 1. The expenditure totalled £2,112,543. Ihe cash receipts thus exceeded payments by £592,487. This is the largest surplus in the history of the department. . , Other business of the department included the issue of money orders and postal notes to the total value of £5,020,890, and the payment on the same account of £4,699,767. War loan certificates redeemed up to the 31st March amounted to £3,349,074. Increased expenditure arising out of war conditions still continues; but, as a result of the successful efforts made to keep down expenditure, the amount asked for this year is £162,000 less than that voted ous year, although it includes statutory increases in salaries due to the lower-paid officers, and an amount of £25,000 for overtime which previously was compensated for by the allowance of “time off.” LAND SETTLEMENT.

The demand for virgin lands has been restricted, only sections in favourably situated localities being taken up. The Government is continuing to offer all available lands for general application, in most cases with preference to discharged soldiers. During the year a total area of 29.588 acres was set apart for selection by _ discharged soldiers, principally in the North Auckland and ITawke’s Bay districts. Proclamations setting apart 46,546 acres of Crown land and 3812 acres of settlement, land for discharged soldiers were revoked in order to open these lands for public selection, owing to the reduced demand by discharged soldiers. The total area set apart for selection by discharged soldiers to the 31st. March, 1923, was 1.397,339 acres, a large proportion of which has.since been made available for general application. ’Hie area available for settlement is 508,403 acres, and 401,742 acres are under survey at the present time. Preparations are also being made for the surveys of a total additional area of 485,598 acres. SWAMP DRAINAGE RECLAMATION. Engineering surveys and investigations of various swamp areas in Westland have been completed for the information of settlers. These, IhouglUnot extensive in area, are promising propositions. Construction .works have been undertaken on an area of Crown land at Ilarihari, Westland, and the proclamation of further districts under the Swamp Drainage Act are awaiting the consent of the owners of the various alienated areas. Operations at the major works nl Kaitaia, Hikttrangi. Hauraki Plains, Irangilaiki Plains and Waihi are being vigorously pushed on. DISCHARGED SOLDIERS SETTLEMENT ACCOUNT. The gross receipts for the year amounted to £1,431,353. ,Of this sunt £716,667 represents repayments of advances, while receipts in respect of interest and sundries total £714,686. In order to afford relief, postponements of instalments were granted where the circumstances appealed to warrant such. At the end of the year the amount outstanding on the postponement account was £67,165 Arrears in respect of interest and principal payments amounted to £541,125. With a view to adjusting, if possible, the position of soldier settlers who suffered from the economic depression, inquiry boards have been set up for each land district. Their reports are now coming to hand, and as a result legislation will be submitted during the present session to give effect as far as possible to the recommendations made by the boards. During the year loans amounting to £868,650 were authorised to 915 soldiers, of which £425,125 were granted to 532 soldiers for the erection of dwellings, the balance being principally. in the direction of advances on current account to aid in improving and stocking lands that have been purchased privately or in respect of ' vacant Crown and settlement lands that have been

j selected. In addition to the sums authorised ns above—namely, £21,278.221 1 lie amount of £3,058,050 has been borrowed for the purchase of lands- for the discharged soldiers brancli of the land, for settlements account, and rents, recoveries, etc., amounting to £44,379 were accounted for last year. There are also other lands acquired in the land for settlement account-which have been proclaimed for discharged, soldier pi.rntses, of the value of £2,514,000, and from (lie native land settlement account, valued at £500,000. The ~ capital therefore provided from all sources for discharged soldier settlement totals approximately '£26,148,000. Applications to finance purchases of farms or to discharge mortgages are now considered only-from-invalided men who were previously unable ,to,Take advantage of the scheme, but who have sufficiently recovered to take up small farms. 1 New applications for loans on current, account will be receivable from such applicants as have made their own financial arrangements to purchase land, or who take.up Crown or settlement land or abandonee! farms, but this cannot be continued indefinitely, and after a date to be subsequently fixed no further applications can be received. Additional advances on current account, for development., of .farms or to stock areas developed, may be granted up to the maximum as recommended by Land Boards, and the system, of readvancing against credits from sales of stock, produce, etc., will be continuedsin terms of the--regulations, hut will cease-.when the occupiers arc sufficiently well established to carry on without- .State aid. REPATRIATION. The benefits under the Repatriation Act ceased to apply to other than tubercular or othen seriously disabled soldiers after the 31st December, 1922. Up to that- date assistance had been rendered to 63,108 discharged soldiers at a total cost of £2,329,992. Recoveries have been good, the amount received up to the 31st March, 1923, being £1,260,545, or 65 pey cent of the total advanced. At that date 5661 loans had been entirely repaid. To the end of the financial year' 1922-23 ' losses had been made in 240 leases, the average loss being £7O. a* AGRICULTURE. ... Tire .total value.oL produce exported was £42,248,751, or 93 per cent- of the value of alb exports, which totalled £45,548,700. The total fruit . area uin commercial orchards throughout the Dominion is approximately 30,000 aeries. Some 108,314 cases have. been.exported .this Beason under a Government guarantee of 11s per case, which covers expenses, and arrangements have been made for the shipment of a .further .25,000 •. cases-- before the export season closes.

.“■ The -beekeeping industry is steadily extending. The honey-export figures for the last three years, are as follows: —1921, 7633 ewt, value £30,962; 1922, 8542, £3l 943 ;i-1923, -10,605, £43,032. The estimated area sown in wheat in 192Z-23-‘~is285)000 acres, and in oats 385,-

000 acres, a decrease in both cases when compared with the previous year. The estimated yield per acre of wheat is 30.48 bushels and of oats 39.50. NAURU AND OCEAN ISLAND PHOSPHATE. An important increase in the demand for phosphate fertilizers has taken place, the importations of Nauru and Ocean Islands phosphate rock for 1922-23 totalling 51,430 tons, an increase of 16,337 tons over 192122. The more extensive use of phosphates will, of course, mean a resultant increase in production. Estimate of revenue, 1923-24. —I estimate the revenuo under the main heads of each of the important departments at—Customs, £7,000,000; beer duty, £750,000; stamp and death duties, £3,364,000; post and telegraph, £2,488,000; land tax, £1 300,000; income tax, £3,500,000; railways £7,000.000; registration and other fees £167,000; marine, £81,000; interest on ’ public moneys, £1,287,000; Local Bodies’Loans Act, 1908, section 76. £22,000; rent of buildings, £20,000; tourist and health resorts, £40,000; miscellaneous, £27 000; territorial, £201.000; national,endowment £128,000; departmental and other receipts, £594,000; total, £27,969,000. Estimated result for the year.—Revenue, £27 969,000 ; expenditure, £27,277,644 ; available for supplementary estimates, Results, 1922-23.—Consolidated fund : Revenue, £27,579,443; expenditure, £26,263 760; excess of revenue over expenditure, £1,315,683.