AUSTRALIA'S TASK

Ashburton Guardian, Volume 50, Issue 261, 18 August 1930, Page 5

AUSTRALIA'S TASK

BALANCING THE BUDGET. A SOLEMN INJUNCTION. FINANCIAL EXPERT'S ADVICE. \United Press Association—Copyright.) 'SYDNEY, August 17., Although Sir Otto Niemeyer, the Bank of England financial expert, has not so far publicly announced his prescription tor easing Australia s financial difficulties, there is ample evidence that the specific object of nis private conferences with the Prime Minister, as Acting-Treasurer, and the Australian Loan Council was in the nature of a solemn injunction to put their house in order. Treasurers of all the States have since set about the task of ti7ing to balance their Budgets, which has meant severe retrenchment and economics, with threats of more to follow. The Government in every State are naturally greatly perturbed, while business and private life have never been so agitated as now. The average man about town will be glad to see the last of Sir Otto, who has been playfully called "Our Bailiff." Sir Otto, however, has not yet finished his unhappy task, for in the coming week he renews his acquaintance with the Loan Council in Melbourne, and on the dtecision of that conference depends whether Australia shall continue to be in the position of being liable to be put in default on any day. The financial editor of the "Sydney Morning Herald" points out: 'lf the Governments take steps to reduce the cost of production and abstain from entering the overseas capital market except for loans for funding or renewal, and raise money locally only for works which will become reproductive within twelve months, then the overseas creditors, if they deem these steps adequate, will give the facilities t 3 extend the period of the present floating debts in order that funding may take place. The alternative is the danger of default and exclusion of Australia from borrowing on) the London market. There are at present overdrafts totalling £28,000,000 with London banks payable on demand, and £'5.000,000 of Australian Treasury bills fall due on August 31st."