LONDON FUNDS

Ashburton Guardian, Volume 61, Issue 22, 6 November 1940, Page 8

LONDON FUNDS

THE “INVISIBLE” DRAIN.

DETAILS BY THE MINISTER

(Per Press Association). AUCKLAND, November 5. Charges totalling more than £25,000,000 on New Zealand’s sterling funds for the 21 months ended on September 30 this year, quite apart from those due to Government debt services and the country’s imports, were itemised by the Alinister for Finance (the Hon. W. Nash), in addressing a luncheon meeting of the New Zealand Institute of Business Executives. After outlining the reasons for the introduction of exchange control and import selection, the Minister gave details of some of the. standing charges to be met before there could be determined the amount for which import licences could be granted. Air Nash said the country was considered to require also at least £12,000,000 a year to meet so-called “invisible” items. One startling filing was that the figure of £12,000,000 was nothing like the total, Mr Nash said. “1‘ was astonished at the other amounts that the country had to meet because of the requests and ordinary investments of the people. '

The Alinister said that for the 21 months ended on September 30 permits granted for remittances from New Zealand for items other than imports and Government debt services, and similai’ charges pame to more than £25,000,000. Interest on local body debt was slightly less than £2,000,000. Repayment of local body debt accounted for some £3,600,000, the United Kingdom haring asked for the repayment of these debts as they became due during the war. Interest and dividends to private persons took between £3,000,000 and £4,000,000, and repayments of debts due involved slightly less than £2,000,000. Legacies amounted to nearly £1,000,000. Capital withdrawn by persons emigrating was £600,000. Earnings of overseas firms fell just short of £2,500,000, and overseas expenses of New Zealand firms took about £1,300,000.

Air Nash said that royalties, commissions, and insurances absorbed nearly another £1,000,000. Donations and similar remittances, including those of a charitable and /religious nature, were 'about £1,000,000, and films and other entertainments accounted for a sum that Was not less than £500,000. Travellers’ remittances were £1,600,000. Anofher item that might run .to large figures was contributions to* troops overseas. There had also been. £IOO,OOO for the relief of distress in London’s bombed! areas,- and a similar amount for the purchase of fighter aeroplanes for the Royal Air Force. “Every time we. are generous it restricts the amount of goods we cam bring into the country,” Air Nash said amid laughter. He added that lie. was very happy to see the people generous; but it was a fact that such gifts meant a limitation: of imports. “We have provided every penny required to me.it New Zealand’s Commitments,” the Alinister added. He said the money made available by the banks in the middle of last year had already (been repaid as had £2.000,000 ini connection with short term debts. Air Nash said that in addition to the “invisible.” drain on sterling, the Government also received; some “invisible” items, and be thought that under this heading something like £5,000,000 could be added! to the value of exports. If the proceeds of the sale of exports and “invisible” receipts wore added together, and from their sum were deducted the items lie had mentioned, plus Government debt services, the amount loft would he that available for imports.