PUBLIC SERVICE ECONOMIES.

Taranaki Daily News, 3 February 1922, Page 8

PUBLIC SERVICE ECONOMIES.

STATEMENT BY MR. MASSEY. DETAILS OF SAVINGS. By Telegraph.—Press Association. Wellington, Feb. 1. During the debate on the second reading of the Public Expenditure Adjustment Bill, the Prime Minister dealt very fully with expenditure out of revenue and the necessity for reduction in order to balance the Dominion’s Budget, as well as to afford the needed relief to the general taxpayer. The Prime Minister has now received from the Secretary of the Teasury the following official statement of the present position regarding economies which have been, or are being, effected in the Public Service in accordance with the Government’s policy of economy:— A steady reduction in expenditure has taken place during the past twelve months. For example, at the 12th of October last savings amounting to £907,041, representing salaries £202,366, and other charges £704,675, had been reported by Departments to the Treasury as having been effected. In addition there had beeft savings on subsidies in respect to flour and butter amounting to approximately £646,093. Savings in interest and sinking fund, amounting to approximately £888'750, had been effected by utilising funds from ordinary reveuue account instead of borrowing for loan purposes, making a total of £2,441,884. The Defence Department had also demobilised 809 officers and employees, whose annual salaries and wages, .charged mainly to war expenses account, totalled about £240,000. The Estimates for the current year were reduced by the Public Accounts Committee b y £260,116, and additional recommendations of the Economies Committee, now being given effect to, are estimated to result in a further annua] saving of £300,000. It must be remembered, however, in connection with economies which have been or are being effected throughout the service, •that existing commitments must be met. and it does not therefore follow that the full effect of these reductions’ will be immediately apparent.

The summarised, results obtained to date are as follows: — Savings to October 12, £2,441,884. Demobilisation (Defence Department) £240,000. Reduction of Estimates, £260,116. Additional recommendation of econo;mies committee, £300,000. Gross savings total, £3,242,000. It is estimated that the gradual elimination of the second cost of living increase will provide an additional annual saving in salaries of £2,000.000, £BOO.000 of which is represented by the first “cut” or £200,000 on the current quarter’s expenditure. The following return shows the number of State employees whose services have been terminated during the year ended December 31, 1921: Department. Permanent. Salaries. £

Economies other than retrenchment have been effected in various forma, notably increase of fees and curtailment of unprofitable services, and suspension of certain services pending a return to normal conditions. . Action has been taken to re-arrange and co-ordinate the duties of officers who are required to travel, and it has resulted in considerI able saving as regards removal and travelling expenses, and the requirements of each department are still being carefully considered with a view to cutting down expenditure in every possible way. Comparing the expenditure for the year 1913-14 (£11,837,264) with that for 1920-21 (£28.128,730), it will be observed that the total has' increased by £16.291,466. or 138 per cent. Of this total £14.591,421, or 52 per cent, of the expenditure for the year 1920-21, is attributable to the late war, as the following figures how:— Interest and sinking fund on war loans £4,493,706. war pensions £1,885,663, National Provident Fund and friendly societies £6,687; total £6,386,056. Cost .of living increases to salaries and wages £4,500.000, cost of living bonus to annuitants £78,697. increases to old age widows, military and miners’ pensions £599.469, butter subsidies £310,603, flour millers’ Subsidies £489,571, miscellaneous £43,711, increases in prices' for coal, stores, clothing, machinery, food, and travelling expenses £2,000.000, increase in interest charges £183,314; total £B,20065, making a grand total f £ft,591,421.

It is therefore not correct to assume that the cost of general administration of Government deparments has increased to any abnormal extent, as an analysis of the above quoted figures will show the expenditure for 1920-21 as £28,128,730, and for 1913-14 as £ll,837,264, the total increase being £16.291.466. Deduct expenditure due to the war (£14.591,421) and the balance is £1,700.045. From the latter amount may be deducted the following extraordinary expenditure totalling £1.501,219: Epidemic pensions £72,456. interest on new loans for general development purposes £1.236.786, expenses of the Prinee of Wales’ visit £94,797, contribution to railway superannuation fund £50.000, aviation £14,888, contribution to superannuation fund on account of defence employees £20.000, medical fees in respect of returned soldiers £12,292; total £1.501.219. Estimates of the revenue and expenditure for the current year are set out, in the Budget, from which monthly averages can be arrived at.’ The Primp Minister added: “Expenditure cannot be cut down all at once: it can only be cut down gradually, and as against reduction in this way there

are always interest and sinking funds qn new loans, loss on railways, and enormously increased cost of material as compared with pre-war prices to be taken into consideration. These latter make retrenchment a slow process, but there are many savings still to be made, though what has been done must have a good effect in restoring prosperity, and another proof of what has been effected will be aft>^ by the Supplementary Estimates when they make their appearance.”

Post Office 48 684 49 15,324 100,304 14,502 Pub. Service (other than, above 7W 199,4*8 Totals 1578 £329,618 Department. Temporary. Salaries. Police 5 1,377 Post Office 89 19,861 Defence ...... 447 102,349 Pub. Service (other than above 600 116,926 Totals (&.w... • 1141 £240,513 Department. Tl. No. Tl. Salaries. ... 53 16.701 Post Office 773 120,165 Defence 496 116,851 Pub. Service (other than above) 1397 316,414 Total. ... 2719 £570,131