THE DOMINION'S FINANCES.

Taranaki Daily News, 1 May 1918, Page 3

THE DOMINION'S FINANCES.

STATKMKXT BY SIR JOSEPH WARD % Telegraph.—Press Association. Wollin<.(on, Last Night. Spe-akni- tonight 011 (lie subject of tin- juiblii- finances, Hir Joseph said that "I regard to tin; surplus, which was fortunately a large one, there appeared to lie an impression in the minds of some people that hi' could make this sum,or large portion s of it, available for expenditure locally. This was an erroneous impression, and lie would like to explain for the benefit of those who turned their eyes towards this large surplus what the position was in connection with it. Owing to war causes, \ery large payments hid to he made in England by way of expenditure, and there were two ways only in which this could be done. We had either to provide the money there, or to borrow upon the English market. The latter course, in view of the heavy discount we would have to give and the high late of interest we wotild have to pay. would be runious to New Zealand from a financial standpoint, and to avoid that, course, and also to prevent any interference with the British money market, which should be left as clear as possible for the use of (he Imperial Government who required to obtain enormous sums for their own war purposes, he had all along followed the course of investing the surplus in Imperial Government stocks, so as to enable the British Government to have as much of our money as possible to go towards their paying (which they were doing) disbursements on behalf of New Zealand for war expenditure. On 31st March the Dominion had investments in Imperial war stocks of £8,770,380, and further investments were being made from time to time. The amount we were providing there was nothing like equal to the total amount that the British Government was paying out for us, and those people in this country who were critical in declaring that a portion of the surplus should be used for the payment of various things in New Zealand would, lie hoped, realise that (he same amount of surplus could not lie used for payment, of our requirements in England also for financial requirements here. It was quite easy for those who did not bear responsibility to declare that the Minister of Finance could devote large sums out of the surplus for various local purposes, but he could assure them this was not possible. One had to deal with the whole requirements of the country, both at this end and at the other' end of the world, where heavy war expenditure was going on, and, surely, it was a wise course to make investments to the fullest extent we could out of our surpluses in Imperial stock and thereby reimburse, to some extent, ths! Imperial Exchequer, which was providing for daily demands on our account. The Minister stated that, at the present moment, we required to make provision for a further £400,000 for war expenditure in Egland, and by the course lie was following the finance of this Dominion at the other end of the world was being greatly assis#d, and the country if self was being kept financially strong. We were getting Imperial stock for our investment, which was available for lodging as first class security if our necessities at any time should require it. At the end of the war when readjustments of finance took place, the whole of the investments we were making would be a great asset for the Dominion, and interest upcrti them, if paid into a sinking fund for the redemption of war loans,_which he hoped if would be made, would give great relief from a taxation point of vieew. In the meantime the country, undoubtedly, had the advantage of great financial strength. Sir Joseph Ward remarked, in conclusion, that, in peace times, no outs would dream of having such ]ar<*e surpluses, but the whole policy in dealing with them now was with the object of carrying on the war needs and of being strong and sound at the end of the war, and he felt quite satisfied that time would prove that this was a wise course to follow.