STATE SPENDING.

Manawatu Standard, Volume LVIII, Issue 43, 19 January 1938, Page 10

STATE SPENDING.

DOMINION’S ECONOMY. LONDON, Dec. 18. “The conclusion drawn from the national accounts for 1936-37 is that New Zealand, in a period of great and rather sudden prosperity, has been living up to her income,” states the report on economic and commercial conditions in New Zealand by Mr R. Boulter and Mr T. G. A. Muntz, British Trade Commissioner and Assistant Commissioner in New Zealand, respectively. The report, which has just been issued by the Department of Overseas Trade, is dated July, 1937. “The desire of the Government to raise the minimum standard of living, as exemplified in such forms as salaries, wages, pensions and allowances, shorter working hours, improved educational facilities and the provision of better housing accommodation, meets with little criticism,” the report states. “More criticism is directed against a large expenditure on public works, and the completion of railway lines of doubtful earning power, at a time when it is contended that the industries of the country should be able to relieve the problem of unemployment. “Certain taxes imposed to meet the exigencies of a period of acute depression remain operative and further taxation has been imposed. The rate of taxation —exclusive of rates levied by local authorities—has increased each year since 1932 and for the financial year 1936-37 was £l9 14s lOd per head of population. , . , ~ “Evidence of the effects which these taxes, in combination with higher

wages and shorter hours, have upon the results of banks and merchants is not hard to find. Dairy farmers have complained that they go far toward nullifying the advantages of the guaranteed prices for butter and cheese. “In many circles the view is held that a slower rate of progress would have been more in accordance with sound finance, and that after the period of severe trial faced during the years of depression a process of lightening rather than increasing the burden of taxation would have fostered recuperation and assisted to build up reserves with which to face whatever trials the future may have in store.”