The Budget.

Stratford Evening Post, Volume XXXIX, Issue 91, 7 August 1914, Page 2

The Budget.

HON. JAMES' ALLEN’S MENT[Pub Press Akkooiatton.] Wellington, August 7. The Financial Statement was delivered in the House last night by the Hon. James Allen. Ho said: It is with considerable gratification that 1 rise to deliver this my third Budget speech. It has been a pleasure to note the stady improvement which has taken place in the prosperity of the country during the time the present Government has held office. Honorable members will recall that during the earlier stages of the past financial year the country had unexpectedly to meet two very heavy calls upon its finances. I refer to the smallpox epidemic, and to the industrial upheaval which blocked the avenues of commerce for a while, and as a natural consequence materially affected the finances of the country. The cost to the Treasury in stamping out the smallpox epidemic amounted to, roughly, £30,000, and the strike cost the country in direct payments approximately £93,000. The figures I have quoted, however, do not by any means represent the total loss which the Treasury suffered in connection with the misfortunes referred to, as both tho railways and Customs revenue wore seriously affected by tho smaller number of persons who travelled in the one case, and by the diminution in the volume of overseas trade in the other.

Notwithstanding these serious drawbacks the revenue for the year showed wonderful buoyancy, and it is with great pleasure that I have to announce a surplus of revenue over expenditure amounting to £426,905. It will not bo exaggerating the position to say that better evidence of the recuperative powers of. the Dominion has never been shown during its past history. When comparing the past year’s revenue and expenditure with that of previous years I would ask honorable' members to bear in mind that a great proportion of the Territorial revenue which formerly went to swell the Consolidated Fund now finds its way into the Lands for Settlements Account under legislation which was passed by the present Government. As the year 1913-14 was the first year in which this change was brought into effect, it will be necessary for purposes of comparison to add to the surplus for 1913-14 a sum of £81,066, representing the amount of the Territorial revenue which would: in previous years have been credited to the Consolidated Fundi. It must also be borne in mind that prior to the assumption of office by the present Government it was the custom to replace buildings destroyed by fire out of the Public Works Fund. This practice was stopped, and £IO,OOO has been set aside each year for the last two years out of ordinaryrevenue to build up, a fire-insurance fund. Further, tire Government, in order to make the Public Service and Teachers’ Superannuation vFunds -financially sound, has had to provide each year from ordinary, revenue an additional .amount of £35,000. I think it will be admitted, in view of the above facts, that the handsome surplus which has been announced is proof of the soundness of the liberal , and progressive legislation which has been endorsed by Parliament, and also of careful administration on the part of the Government. REVENUE. The revenue for the year was estimated at £11,789,602, but the total collections amounted to £12,234,339, or J£434,737 in excess of the estimate, made up as indicated in the following table. Receipts Estimated. Actual. Revenue Account — £• ■£• Customs - 3,250,000 3,426,744 Railways ' ... 4,200,000 4,028,739 Stamps . • ... 1,000,000 1,221,971 Post and Telegraph 1,230,000 1,257,537 Land-tax ... 750,000 707,451 Income-tax ... 470,000 554,271 Beer Duty ... 124,000 127,041 Registration and other Fees 92,000 100,635 Marine ... 51,200 53,037 Miscellaneous,... 360,000 424,067 Territorial Revenue 190,000 190,444 National Endowment Revenue ... 72,402 <2,102 Totals ... 11,789,602 12,224,339 From the comparative table furnished hereunder it will he seen that an increase of £490,317 over the revenue of the previous financial year is recorded £. Revenue, 1913-14 ... 12,224,339 Revenue, 1912-13 ... H, <34,022 Increase ••• £490,317 CONSOLIDATED FUND REVENUE for the financial y far ended THE 31st MARCH, 1914, COMPARED WITH THE PREVIOUS YEAR. Consolidated Fund 1913-14. 1912-13. Ordinary Revenue — £ £• Customs ... 3,426,744 3,407,538 Stamps (Stamp Department) 1,221,971 1,052,347 Postal and Telegraph 1,257,537 1,167,977 Land-tax ... 767,451 <28.636 Income-tax ... 554,271 402,994 Beer Duty ... 127,041 124,223 Railways ••• 4,023,739 3,968,350 Registration and other Fees 100,635 93,930 Marine ... 53,037 52,765 Miscellaneous 124,067 361,339 Territorial Revenue 190,444 254,509 National Endowment Revenue 72,402 59,414 Totals ... 12,224,339 11,734,022

COMPARED WITH 1911-12. Revenue, 1913-14 ... 12,224,339 Revenue, 1911-12 ...11,032,544 Increase ... £1,191,795 It is gratifying to note that the revenue in the case of each revenue-pro-ducing Department shows a satisfactory increase over the revenue of the preceding year, except, of course, the Territorial revenue, for the reason already stated. The increase in the land and income tax is due partly to amended legislation and partly to the natural increase in prosperity of tho taxpayers. EXPENDITURE. £. Estimated expenditure, 1913-14 ... ••• 12,000,735 ; Expenditure ... 11,825,864 Less than estimate £174,871 EXPENDITURE, 1913-14, COMPARED WITH 1912-13. 1913-14. Permanent appropriations 4,236,089 Annual appropriations ... 7,589,7(0 £11,825,864 1912-13. Permanent appropriations 4,052,185 Annual appropriations ... 7,029,853 £11,082,038 Increase ... ••• £743,826 As under— Increase permanent appro. 183,904 Increase annual appro. ... 559,922 Total ... ••• 743,826 RESULT OF THE YEAR’S OPERATIONS. ' Balance brought forward Ist April, 1913 709,508 Receipts during year £■ Revenue ... 12,224,339 Other receipts 5,322 12,229,601 Expenditure during year— Appropriations 11,825,804 Debentures redeemed 1 : General Purposes Loan Act, 1873 11,400 11,837,264 Excess of receipts over exp. 392,39( Total ... ... *»• 1,101,905. Transfer to P.W. Fund 675,000 Balance, 31st March; • 1914 £426,900 ■I i <i ' THE PUBLIC DEBT.,, The gross public i debt, at th,e end of the’ financial yeai; amounted to £99,730,427, and the net debt to £91,689,835. The following table shows the purposes for which the various amounts were borrowed: — £ Maori War 2,35^000 Defence ... ••• 4,101,952 Public ,wpr „;rCONCLUSION.

The foregoing statement of the position of the Dominion and of the proposals of the Government with regard to the future will clearly show that the general prosperity which we have enjoyed for some years past still continues, and that it is the earnest desire of the Government to promote this prosperity to the best of its ability. No effort has been spared in furthering the industrial welfare 'and the commercial advancement of the Dominion, and I can see no unfavorable signs within the Dominion at the present time which are likely to mar the prospects for the immediate future. New markets for our', produce have been developed, and our exports have touched a point which has never before been reached in the history of the country. The Dominion is also, I am happy to say, enjoying industrial peace and there is at the present time no cloud upon the horizon which is likely to disturb the industrial and social conditions in the community. Should this happy state of affairs continue, I fully anticipate that the present year will prove to bo one of unexampled prosperity. ‘ ■- ! There are before us still some delileate financial transactions to complete in order to meet maturing loans in London, but, unless some unforeseen contingencies should arise which would unfavorably affect the money-market, I fully anticipate that the high standing of the country will enable us to negotiate the necessary loans on favorable terms. The statement I have just read was in print before the Empire became involved in war with all its terrible consequences, and honorable members will allow that under the circumstances the estimates of revenue and expenditure may require to be amended. The people of this Dominion may, and, no doubt, will, have to make sacrifices, but those I feel sure will be willingly accepted in the grave crisis which means so much to the jMother Country and tbe Dominions, i Every Now Zealander looks forward to the future with anxiety. It may I he but the calm assurance that every[thing which is possible to do is being done, and with the hope that when the war comes to an end, lastjinjr peace will bo secured. Our .hanks are in an exceptionally strong position, but to make them still more secure and to allay any possible foolling of unrest, bank notes were yesjterday, by proclamation, made legal j tender. The Government desires ■most earnestly to impress upon our [merchants ami traders, both wholesale and retail, and distributors, bow cruel it will be to attempt by any

rise in prices of foodstuffs to reap advantage out of the present trouble, and how patriotic those people will be considered who even at some sacrifice retain the level of prices of foodstuffs in existence before this crisis eventuated. 1 have every confidence that this warning is unnecessary, but the public may rest assured of this, that the Government has for some days past had under consideration the necessity for active steps to prevent a rise in the price of foodstuffs, and if it is found that legislation is necessary, Parliament will be asked to pass that legislation, j and to make it retrospective if need he. In conclusion, may I express the earnest hope that the next financial statement may record once again a prosperous year with tho balance on the rigl.it side. Finally, may the Almighty Giver of all that is good, protect our King, his representatives, and councillors 'wherever they may be. May He guide them in their deliberations. May His protectory arm be over all our people, and especially over the soldiers and sailors who are called upon at this time to make, it may be, the supreme sacrifice for King and Empire. THE ROADINC QUESTION. RADICAL CHANCE OF SYSTEM. I am confident, the Minister went on to say, that the House will support tho Government in its effort by legislation to institute a control, independent of" the Government and of party, of moneys provided from the Consolidated Fund and the Public Works Fund in aid of local government and local works. It is necessary to distinguish between subsidies and grants. Subsidies are provided from the Consolidated Fund in aid of the ordinary revenue of local authorities, and constitute tho annual contribution by the State to the cost of local government. The Municipal Councils alone at present have their subsidies determined by a permanent Act, and hold a statutory appropriation. The other local authorities which at present receive subsidy—namely, bounties, read boards, and town boards—have the annual contribution of the country determined each year in the Appropriation Act. The Government proposes to establish all subsidies at the present rate by statutory appropriation, and to provide a further sum equal to one-fourth of the total subsidies, and place the sum annually in the hands of an independent Board for allocation among the districts which, for particular reasons, require special assistance from the State. Grants from the Public Works Fund are at present made to provide, either wholly or in part, the cost of local works the construction of which tlio Government of the day thinks it desirable to encourage, provision being made by annual appropriation in accord with the Public W orks Statement of the year. The Government intends to establish an impartial and absolutely non-political system for the apportionment of that part of the Public Works Fund which is available in any one year for aid to local works; ' aVuk while I recpgnise the gravity and far-reaching effect of such a change, I believe it will have the approval of Parliament and of tho country.

A further large provision for the relief of local finances is proposed in that part of the Local Grants and Subsidies Bill which directs the ascertainment by the same impartial and non-political Board of what are, and what are not, main arterial roads or the Dominion, and to what extent the Government funds should bo applied to the construction and maintenance of such roads in relief, wholly, or in part, of the funds of the local authorities. In this case the ascertainment by the Board is required to bo sublimited for the approval of the House before it is finally adopted. But practically the settlement of this long vexed question is now made possible. The principle to bo established is that, while the roads ot a district must be provided and maintained by that district from its own funds, except so far as they are aided iby subsidies or grunts, the maintenance of the main j arterial roads, which serve the purposes of the people of the Dominion, [and not merely of the people of the locality, should he the function largely of the Dominion, and ifat of the [locality. The intention of the Government is to establish a definite rule that works which arc of-special interest and advantage to a locality, should be provided by that locality, while works such as arterial loads, j which are of far more than local 111'terost or advantage, should be one of [the burdens on the Dominion finances. The effect upon the annual finance 01 .'local authorities will be practically the [same as a large increase of the au- | nual subsidies j but I believe that the principle which I have outlined is just, and that by the country taking over for the first time its full share of too burden of the main roads of the Dominion the local authorities will he enabled in future, out of their ordinary j finances, to make more ample provisions for local needs.