THE PUBLIC DEBT.

Auckland Star, Volume LVII, Issue 305, 24 December 1926, Page 10

THE PUBLIC DEBT.

NEW OFFICIAL ANALYSIS. REPRODUCTIVE LOANS. .MORE THAX HALF IXTERESTEARXIXG. (By Telegraph. — Special to "Star.") WELLIXGTOX*, this day. With a public debt approaching 239 millions sterling:, it is important to the taxpayer to know that the proportion which is directly interest-earning is 51.38 per cent. The whole position is analysed in the Xew Zealand Year Book for 1927 in complete fashion, the reproductive loans being separated from those partially reproductive, and details given also of loans which do not return their annual interest. There are five main divisions, which are classed as follows: — Per cent. Productive works 26.50 [.mill settlement anil forests... 10.81 Investments 14.07 Indirectly productive purposes.. 5.64 Financially unproductive Hi). 08 The European war made a great difference in the character of Xew Zealand's debt. Before the war loans had to be raised, the unproductive debt was only 20 per cent of the total, but during the six years ended March, 1920, eighty millions of war debt was responsible for 77 per cent of the new indebtedness incurred in that period being unreproduetive. The war debt eventually grew to over 82 millions, but it has since been reduced by nearly seven millions, and now stands at £75,333,000. Productive works represented in the official loan schedule amount to £63,302,990, the leading item being nearly 4S millions for railways. Telegraphs and telephones represent over seven millions, hydroelectric power £4.509,000, lighthouses and harbour works over a million. Land settlement and forests account for £25,814,000 of the loan indebtedness, the items including £9,757,000 for settlement of discharged soldiers, £8,745,000 land for settlements, £3,896,000 native land settlement, and nearly two millions for purchase of native land. Investments form an important item of the reproductive loans, as these include over IS millions in the State Advances Department, nearly seven millions advanced to workers,

advanced to local bodies, £875,000 in the Bank of New Zealand shares, and over half a million invested in Nauru and Ocean Islands phosphate enterprise. Classified as indirectly productive is a sum of £20,634,000, including over 14 millions, the estimated value of highways, and £2,633,000, the cost of immigration. The European war loans stand out at the head of a list of unproductive loans totalling £95,486,000, and the country is still carrying a debt of £4,007,000 from the Maori wars. Over eleven millions expended on public buildings and schools is also included under this heading. Interest payments by the State amount to £5 16/10 per head of the whole population, but it is some satisfaction that over 44 per cent of the interest is paid within New Zealand. The proportion which goes to London is 53.61 per cent, while Australian investors take 1.52 per cent.