HOW MUCH LONGER ?

Auckland Star, Volume LVIII, Issue 108, 10 May 1927, Page 8

HOW MUCH LONGER ?

NEW ZEALAND'S BORROWING.

REDUCTION POSSIBLE SOON.

BIG WORKS MUST BE FINISHED.

(By Telegraph.—Special to "Star.")

FEILDING, Monday.

"People ask the question, 'How long are you going on borrowing, and when will these great public undertakings be finished?" remarked the Hon. W. Downie Stewart, in the course of hie speech here to-night. "My answer is that it would be possible to stop borrowing at any time if the people of New Zealand decided that they no longer wished as a matter of national policy to extend their own hydro-electric works, their own railways, and other public utilities, and if they decided that it was no longer the duty of the Government to assist in solving the housing problem or to lend cheap money to farmers. Not only so, but if the* people of New Zealand went one step further and decided to get rid of the public ownership of these undertakings we could without doubt reduce the debt within twelve months to about one-third of its present magnitude. A Contrary Tendency. "So far, however, from any tendency in this direction, year by year there is a more insatiable demand for further expenditure by the Government. Everyone ia tending more and more to lean upon the State and to regard the Government as the only money lender and the only house builder. It is impossible for us to go on raising unlimited millions for these purposes even if the money is widely and carefully administered. Nevertheless, applicants for loans are most indignant when we suggest that the resources of the Department are not unlimited, and that some reliance must still be placed upon the private builder or the private money lender. "It is true that the London financiers regard New Zealand as a epund investment. But we should not in borrowing be tempted by what London is willing to lend, but rather limit ourselves to the lowest amount necessary to complete public works and to see that the money is wisely expended. This precaution is especially needed in New Zealand, because our prosperity depends on factors over which we can only exercise a very limited control. If We Stopped Borrowing. "But assuming a Minister of Finance took office and decided to stop all borrowing at once, what would' we find ? Great schemes like Arapuni and the irrigation works in Central Otago would have to be left half-finished or else constructed slowly over a long series of years out of tax revenue. But everyone knows that once such great works are undertaken the sooner they are finished and revenue earning the better; otherwise you have vast sums tied up earning nothing. "The next few years are peak years pf expenditure in finishing pur hydroelectric schemes and railway lines and improvements. But after that, unless some pew programme is put forward, I see no reason why our loan expenditure shpuld not be reduced to such small dimensions that we can give up oversea borrowing."