“ABSOLUTELY SOUND ”

Taranaki Daily News, 5 February 1921, Page 5

“ABSOLUTELY SOUND ”

NEW ZEALAND’S POSITION. PRIME MINISTER ON FINANCE. MORE MONEY REQUIRED. , Auckland, Feb. 3. Taxation and criticisms of the amounts being levied in New Zealand at present were dealt with by the Prime Minister at a luncheon tendered to him at Pukekohj? to-day. The principal adverse criticism levelled against the administration was that, the Government was sinning by increasing taxation: but he wished them to try to recollect one instance in which increased taxation had been collected. After referring to expenditure, Mr. Massey said that more money would be required, though he did not know when it would be needed. It would be necessary to go on to the open market for it. Money would be needed -for roads, bridges, hydro-electric power, education, and numbers of other purposes. The country had got on very well with the reconstruction problem and had nothing to complain over at present. ’ The criticisms coming from a New Zealander in London recently had declared that unless great oare was taken the country would be 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. When the Imperial requisition came to an end there had been a sort of interregnum, during which money was not coming. It had scarcely begun to 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 could come without war It was the best thing which had ever (happened for New Zealand. IMPORTS AND CUSTOMS. Another factor to be considered was the increase of 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, but this could not be maintained. While this year’s returns would be far above the average, next year’s would be proportionately below the average, and it was of the next year that he had to think. He had to set aside a reserve to tide , over this period. He hoped that when i 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 the part of the Treasury and different departments.

ACCUMULATED SURPLUSES. Reference had been made to the £15,000,000 of accumulated surpluses, and it had been suggested that the Government had wasted it. Tli(it money had been spent in placing soldiers on the land and finding houses for them, and the greater part of it was earning 4 per cent. The Government had either to take it, to borrow other money, or to break the country’s word to the soldiers. If money had been borrowed it would have cost five and a half per cent., and would, have required a, sinking fund of 1 per cent, as a war loan. That was only one item, but the next financial statement would show there had been saving all round.

WAR DEBTS AND ASSETA He insisted that the country was absolutely sound; no other country could bo sounder. R-oughly, the country’s war debt and ordinary debt amounted to £200,000.060, and there were assets for everything except £60,000,000. The difficulty was going to be in the next eighteen months to get revenue to meet the accounts.