FINANCIAL STATEMENT.

Wairarapa Age, Volume XXXI, Issue 9136, 8 July 1908, Page 5

FINANCIAL STATEMENT.

PRUPOSED LEGISLATION

(Per Government Memo.)

The Premier delivered his financial statement in the House of Representatives last evening. He stated, inter alia:—Thi progress which has characterised the Dominion since the Liberal Party came into power in 1891 still continues. I took an opportunity after the 31st March last to make the results of the year known to the country, and it was a great source of satisfaction to me to be able to announce that we had after transferring £700,000 to the Public Works Fund closed the year's accounts with a substantial credit balance of £767,849. The revenue for the year just closed reached the record sum of £9,055,946, exceeding that of the previous year by £656,871. Every class of revenue with one exception, has contributed to this splendid result. Customs show an increase of £162,525, railways and stamps £185,207, The expenditure for the year amounted to £8,213,965, £439,039 more than the preceding year. I was able to transfer to public works the sum of £BO,OOO. This is the largest amount that has been transferred for this purpose in any one year, bringing up the total amount transferred from revenue in aid of public works since 1891 to £6,430,000 an amount which it would have been necessary to borrow had we not had such a buoyant revenue.

PUBLIC WORKS FUND. This account had a balance of £359,400 to start the year with. The total available for ways and means was £2,039,154. The expenditure out of these moneys amounted to £l,886,591, leaving a balance of £152,563. LOANS TO LOCAL BODIES. The balance at credit of the Loans to Local Bodies Account on the 31st March, 1907, was £397. Debentures for £185,000 were created, and issued during the year, and refunds of unexpendeJ balances of grants amounting to £BIB were received. Payments on account of loans made during the past year to local bodies amounted to £136,420, and towards opening up blocks of land for settlement £38,524, leaving at tho end of the year a balance of £11,271 to the credit of the account. The reduction in the rates of interest on loans granted under the Amendment Act introduced by the Government last session has proved a great boon to the settlers, and has given general satisfaction to the ratepayers in the areas on which it has been necessary to make roads and bridge?, and carry out o:htr public works. PUBLIC DEBT.

The gross public debt on the 31st March, 19.07, was £63,179,040; on the last it was £66,443,897?' or an increase of £2,274,857. This may appear to be a very large increase, but so bng as the policy to acquire land for close settlement, construction of railway-', roads and bridges, lending to local bodies, and making advances to settlers is approved of by Parliament, the public debt of the Dominion must go on increasing. Of the new debt raised no less a sum than £2,360,904 may be set down as b-.ing of a directly interest-producing character, as follows:—For acquiremei.t of lands for settlement for additions to open lines £200,000, for loans to local authorities £185,000, for advances to settlers £550,000, for advances to workers £185.0U0, for investment in gilt-edged securities £BOO,OOO, for New Zealand Console deposits £214; total £2,360,904, leaving £877,953 as issued for general purposes.

LOANS MATURED. During the past year no less a sum than £2,582,900 fell due, and I was able to very satisfactorily arrange for their renewal. CUSTOMS. The working of the n*w tariff has very satisfactory, most of the changes being of such a character as to facilitate the entering of goods at the Custom House.

LAND AND INCOME TAX. The receipts from land tax exceeded the estimate by £22,846, and were £90,504 in excess of the amount collected in the previous year. The income tax receipts show an increase on the estimates of £24,904, and an increase of £27,037 on the collection of the previous year. The total receipts from both taxes therefore produced £47,750 more than was estimated, and £117,541 more than was collected in the previous year. The land tax shows a steady increase, apart from the additional revenue resulting from the amending le islat'on of last year, and this, notwithstanding the loss arising from the subdivision of estates and the operations of the land purchase department, which is vjry considerable. The increase in ordinary land tax amounted to £28,991. The increase in graduated land tax amounted to £6o,o7o—this is partly from increasing values and increased rates, owing to the legislation of last session, and from the stoppage of evasions. POST AND TELEGRAPH DEPARTMENT.

The revenue for the past year reached ,£822,639. At the present rate of progress the annual rcenue will soon exceed one million pounds. I propose this year to reduce the rental for private boxes in the smaller towns where there is no letter-carrier delivery from £1 to 10s per annum. The amount expended during the financial year, 1907-8, on telegraph extension was £155,491. Nine thousand six hundred and fiftysix miles of telegraph line and 29,344 miles of wire were erected during the year. The number of telephone exchange connections has increased ti 28,981, and the revenue therefrom i.s £116,852 13s lOd. One thousand six hundred and eleven telegraph and telehone offices were open on the 31st March, being an incx*ea3e of 1(54 over the previous year. ADVANCES TO SETTLERS AND WORKERS. It is difficult to adequately appreciate the benefits that the Dominion has derived from the policy of making advances to settlers. By the beneficial legislation of the Govern • ment about twenty-four thousand I settlers and workers have been assisted, many of them to positions I of afHuance.

LAND FOR SETTLEMENTS,

During the past year the purchase 'of sixteen estates has been completed. They comprise 126,868 acres, and the price paid was £565,728, which, with the costs incident to their settlement and to the settlement of lands previously acquired (£47,963), make a capital sum invested of £613,696. The total area of land acquired and paid for to the end of last year is 1,122.135 acres. The area of land opened for selection under the Act during the year is 73,490 acres, and 114,150 acres were taken up by 420 tenants. The total area leased to 31st March, 1908, to 4,217 tenants, is 979,080 acres. Of this G79,410 acres are held under leases in perpetuity; 67,107 under renewable leases; and 229,495 under small grazing run luases and miscellaneous tenures. NATIVE LAND COURT.

The expenditure under the Native Land Court vote for the year was £15,438, wliil" court and registration fees payable to the Department in form of stamps totalled £4,380 15s. MINING INDUSTRY. The mining industry still continues prosperous, and the export of gold, although slightly leas than that of the previous year, is yet very considerable. The outlook for the future continues to improve. The export of silver for the year is a record, being £25.912 greater than that of the previous year. CHEAP CABLES. A proposal of far-reaching importance, which will, it is hoped, receive t h e serious consideration of all parts of the Empire in that of Mr J. Hen niker Heaton, M.P.. to establish a penny a word rate for cable messages. In my opinion the scheme is feasible, and is therefore one which has my entire sympathy and support. ADOPTION OF POST AUDIT.

The auditing of public accounts is a matter of the very greatest importance, and every effort should be made to prevent even the possibility of criticism tending in any way to cast a doubt upon the reliability of the system now in v operation under which auditing has at all times been carried out with intergity and efficiency by the gentleman holding the responsible position of Controller and Auditor-General. Yet there has been epxressed more than once a desire for fuller details than is possible under the present system, so that every one who runs may read. And the only feasible and practical way to accomplish this is, in my opinion, to abolish the syttem of pre - auditing and ado,;t one of post auditing similar to that in Canada and other British countries. I am, therefore, submitting a Bill for consideration of meir.bers making provision for this change to be fivcn effect to. The name of every person to whom a payment is made and every penny-pieco. of expenditure will be set out in detail and laid <ipon the tabic of the House. ADVANCES TO SETTLERS. The ac'.ive land settlement that has been going on throughout the country nnecessarily calls for a amount of money by those acquiring sections. A number of largo holders have been placing the excess of their land upon the market, and f ,<> Ibis fact I attribute to some extent the considerable (Jem 'hd that is bcind; made throughout the Dominion finfinancial assistance from the Advances to Settlers Department. It has worked so satisfactorily up to now, and time has long since passed when any doubt can exist in the minds of the sceptical as to its stability that I feel justified in asking the House to increase* the limits of borrowing for that department from five millions to six millions. It may not be found necessary to utilise all, or, indtel, any portion of extra million, but I am sure members will agree with me that it is desirable that many of our enterprising settlers who may look to this Department for advances should not be denied on account of the maximum amount now fixed.

"""ADVANCES TO WORKERS. While I am upon this subject I desire to point out that the system of malting advances to workers is more satisfactory to the worker who desires to have a home than that of the Government purchasing land in the country and erecting houses upon sections and leasing them to workers, and I am of opinion that this system of purchasing land and building homes can, without any disadvantage to workers, be eased off, and that operations for helping workers to obtain homes could more advantageously be conducted upon a systematic basis. NATIONAL SUPERANNUATION.

A Bill will shortly be introduced inaugurating a national superannuation to which all New Zealand residents under the age of fifty-five will be at liberty to contribute. 1 propose that the State shall also contribute towards the support of the fund which will provide to contributors, in return for moderate payments, pensions not exceeding £2 a week in any care, either or attaining the age of sixty or sixty-five, or on becoming permanently unable to work by reason of sickness or accident, before reaching the pension age. The fund will also provide assistance to widows and orphans of contributors. 1 propose that widows should receivt; £l3 per year, and their children 53 per week; orphans also 5s weekly until each attains the age of fourteen years. I will also submit a supplementary scheme dealing specially with low wage earners with large families. I am cf opinion that if we can establish a system by which the breadwinners can make sure of those dependent upon thum being provided for in the event of'sickness, accident, or death, much will be done to solve the present problem that creates a spirit of unrest which is largely doe to the difiiculty'of provision being made for hvge numbers of our people who set* little brightness before them, owing to the difficulty of bringing their families up respectably and making both ends meet.

LOCAL BODIES SUPERANNUATION. A measure will be submitted for the purpose of enabling any local body to inaugurate a superannuation fund for its employees, each local body being allowed to arrange details to suit its own circumstances,' subject to the scheme being approved of by the Minister of Finance. LAND FOR SETTLEMENTS ACT. The work of Land for Settlements

I Act involves an expenditure of about half a million sterling per annum, which adds directly to our public debt. After careful consideration i am of opinion that a departure in another direction should be made, and a system of special settlement established so as to enable that great desideratum, the closer settlement of land, to be carried out still mere expeditiously. I, therefore, propose to submit proposals to the House this sesshn, making financial provision for special land settlement upon the following lines:— Upon application by any number, say ten or more, intending bona fide settlers, who have obtained from a private landowner an offer to sell an estate at a price fixed by him, the Land furchase Board shall inspect the land to ascertain its suitability for settlement

and fairness of price, and if trie Board is satisfied on both points it will report to the Minister of Finance. The proposed settlers will then submit a scheme of settlement which must become consistent with the limitations and other conditions of tie Land for Settlements Act. if the scheme is approved by the Land Purchase Board, the Advances to Settlers Department, through the Minister of Finance, will obtain t e money required to purchase the estate at the lowest possible rate of interest, giving to the lender as security for such money a mortgage over the estate in the name of the settlers who will also bind themselves as ordinary

mortgagors by their own covenants, in addition to security, and the Government will guarantee repayment of the capital and of interest to the lender. 1 propose to provide for a redemption fund by which sattlers would repay both principal and interest in 32£ years. ROADING. The work of roading in parts of this country is a matter of the greatest importance, and, in view of the energetic sett'ement that has gone (nail over the Dominion, the tine has arrived when greater steps than hitherto must be taken to provide roads for setllers, especially in the back-blocks. I propose this year to ask the House to provide ;S(S50,000 for roads and bridges, and of this £250,000 will be devoted to roais in back-blocks, and will be continued for a period of four \ears, including the current year. A million in all will be expended for this laudable purpose. MAIN TRUNK LINE. It is probable that the regular express train servics will be started by November Ist. FINANCE FOR 1908-9. I now come to the consideration of expenditure and revenue for the current year. The estimated expenditure for the! present year amourts to £1,662,993, or £449,028 more than that la-t year. Turning now to our ways and means for the year I find that after giving the mattes' careful consideration lam able to estimate our revenue from all sources as £8,955,030, or £7,946 less than the amount received year. Apart from tiie lower pricp of wool an.l flax I have no reason to anticipate any falling off in revenue, except in so iar as it will be affected by tariff revision« made last session. On the contrary, the revenue has beer, so buoyant for several, years that it is just a question whether the net remissions will not be compensated by

natural increase arising from increased population, and the continued prosperity of the country. With these considerations in view I estimate tbe amount of Customs revenue will be £2,950,000, or £153,565 less than the collections of last year. Consideting the Eteady increasing volume of railway business, and the additional mileage of line now under construction, and which I expect will be taken over during tha current year, I estimate that the gross earnings of the railways for the twelve months may bs safely put down as £2,835,000, or £69,605 more than the actual receipts of last year. Bringing the estimates of the expenditure and revenue together, the position at the clcse of the current financial year may be set down as follows:—Estimated revenue £8.985,000; estimated expenditure, £8,662,993; excess of revenue over expenditure, £322,009; add balance from the last year, £767,849; total, £1,089,856. From this amount I propose to "set aside £BOO,OOO for transfer to the Public Works Fund, and £60,000 for additional contribution to the British Navy,

leavirg a balance of £229,856. Members will be interested to know what provision is being made for ways and means for carrying on the public works of the current year. Ii have already informed you that | £650,000 is to be expended upon roads, and of this amount £250,000 will be devoted to roads in the back blocks, the balance of the £650.000,* viz., £400,000, being utilised for roads and bridges generally; £350,000 will be devoted to additions to open lines, making further provision for railway rolling stock, etc. In order to enable the more vigorous prosecution of our railways to be carried on I propose *his year 1o set aside one million sterling for this purpose. For public buildings, tele graph and telephone extension it is proposed to set aside £350,000, thus making a total of £2,350,000.

CONCLUSION. I have now placed before honour-, able members particulars awl int'ur mation connected wit.ii our financial position that I hope will be of interest to them. I am confident that the financial result of the current year will be as satisfactory as the last.