METHODS OF FINANCE.

Auckland Star, Volume L, Issue 265, 7 November 1919, Page 4

METHODS OF FINANCE.

Our mild comment yesterday on the records of Sir Joseph Ward and Sir James Allen, as Ministers of Finance— comment made in fairness to the Leader of the Opposition—has drawn a long reply from the local Reform organ, in which, very naturally, the best possible case is made out for the present Minister. But the points of our article, the main one being the fact that Sir Joseph Ward was able to show a surplus year after year, remain where they were. Our contemporary remarks that it is a Liberal tradition that Sir Joseph Ward is the only poseible Minister o£ Finance for Xew Zealand. That may be the .Reform reading of the Liberal tradition. We certainly think—and a good many Reformers would agree* with vs —that Sir Joseph Ward knows more about public finance than any man inside or outside Parliament. We were quite fair to Sir James Allen, for we admitted that ho could not be judged until the end of the financial year. But when our contemporary seeks to prove that the conditions under which Sir James is working are much more difficult than those confronting Sir Joseph Ward in his day, we must point out that it has overlooked important facts, such ac the return of thousands of soldiers, who are both workers and taxpayers, from unproductive to productive labour, and the stimulus given to trade by the coming of peace. Interim statistics show that the export trade thie year will be very much more valuable than last year, which imeans that more money will come into the country, and large amounts swell the Consolidnt.il Fund. What we find serious in the financial outlook is briefly this: Taxation remains at the war level, there is a heavy increase in Depart mental expenditure, and debt charges are bound to increase, all leading to the possibility that it will be impossible to reduce taxation, and that it may even be necessary to increase it. While the expenditure for the current year is over twenty-three millions, the Government is, in addition, going , to spend most of the accumulated surplus, and has also raised a loan of ten millions for war and repatriation purposes. The total loan money required for the year ending 31st August, 1920, including the above amounts, was estimated at over

£30,000,000, and since then there have been additions to the total for public works and housing. The public of New Zealand has to face a Budget that for practical purposes amounts not to £23,000,000, but to a figure well over twice that enormous sum. Under the circumstances something akin to anxiety about the Dominion's future is quite justified, and appeals for economy are thoroughly well founded. Our contemporary evidently realises this, for it admits that ' the departmental expenditure is "uncom- ' fortably high," and in its rotund style remarks that the electors arc "fully entitled to inquire whether there is not ' a general inflation of departmental expenditure, which could be checked with advantage to the public purse." That is just what we have been contending, and it is a pleasure to be able to agree with our Reform friend on a political subject for once in a way. '