POINTS FROM THE REPORT.

Auckland Star, Volume LX, Issue 43, 20 February 1929, Page 8

POINTS FROM THE REPORT.

DISASTROUS BORROWING POLICY. BUDGET MUST BE BALANCED. Dealing in detail with the financial position of the mandated territory, the report points out that from the inception of the civil administration the revenues have been insufficient to meet the expenditure, and the New Zealand taxpayer has been called on each year to find substantial grants in aid. These free grants amounted on March 31, 1928, to approximately £160,000, of which £61,000 was from the Reparation Estates. To this amount must be added grants for the current year of £20,000 (£12,000 from the Reparation Estates), and the cost of the present military police located in the territory, estimated for the current year at £32,000, so that New Zealand ha# contributed financial assistance to the extent of £212,000. A further burden carried by New Zealand is the coet of the new vessel Maui Pomare, approximately £54,000, of which £33,900 has been met by Vote External Affaire on account of Samoa. Aβ yet no return on this capital has been received, nor does any return appear to be likely. In addition, a large amount has been contributed indirectly through what we regard as irregular Reparation Estates' activities on behalf of the Administration.

Aβ a contrast to ita inability to balance its Budget without assistance, a borrowing policy has been adopted which has resulted in the growth of a public debt from nil in 1920 to approximately £160,200 at March 31, 1938, and £173,200 at September 30, 1928, thua imposing on an already overloaded Budget an annual burden of approximately £12,500 for interest and sinking fund charges. Unnecessary Staff. Inquiry into the working ef the Labour and Chinese Department showed that the staff employed was in excess of requirements. It consisted of a Commissioner of Labonr (salary £605), who held the position of Commissioner of the Higli Court, and also acted as tourist officer, a clerk (£310), a Chinese interpreter (£360) and four Chinese police at £80 each and uniforms. The interpreter appeared to be the official upon whom devolved the regular routine work of the Department. The clerk'a duties were of the simplest character possible, insufficient to occupy the attention of a competent official for more than a very limited portion of the day, and the salary for the position was excessive. The Chinese police staff did not appear to be fully occupied and a reduction from four to two is recommended.

Payments, states the report, have been made for the use of the Tourist Commissioner's private car, to enable visitors to visit some of the places of interest, and special payments by way of increased salary have been made to provide refreshments for eueh persons. "We are definitely of opinion," continues the report, "that both payments should cease. Visitors to Samoa, while they might reasonably be supplied with literature respecting the places of interest, should otherwise be left to their own resources. Private enterprise in the island could be relied upon to provide all necessary facilities." It is recommended that the Department, as such, be abolished, that the services of the Commissioner, as such, should cease, and that the office be attached to one of the existing Departments, say, the secretariat. Military Police Expenditure. The organisation and control of the Customs, Taxes and Marine Department proved to be on a more reasonable basis than in the majority of other Departments, due largely, so the commissioners believe, to the fact that the system was instituted by trained officers of the New Zealand Customs Department, but certain matters called for attention. The poet

office, which was organised on lines similar to those obtaining in New Zealand, appeared to be reasonably well managed, the principal officers of the staff, compiled of officials from the New Zealand service, being fully alive to the necessity for maintaining an efficient service. The expenditure in connection with the military police, states the report, is charged to New Zealand in accordance with section 7 of the Finance Act, 1928. "We feel that in many cases expenditure has been incurred which should have had prior approval from New Zealand," report the commissioners, ''and that in general too heavy a burden has been placed upon this item, e.g.,-all medical attention for members of the force has been charged as for individual visits, with the result that the total has been practically sufficient to pay the cost of a medical officer for the force alone. The amount charged for transport also is, in our opinion, out of all reason, and should be reconsidered at once."

Crowds of Native Officials. Criticising the Native Department the report said that the most striking characteristic was the extraordinary number of native officials, the number provided for on the estimates exceeding 300, and the remuneration, though in many cases small in total, amounted to some £10,000 a year. With few exceptions the village and district native officials were practically useless. Under the heading "Public Trust Office and Official Assignee" (a unit of the Treasury), the report stated that the loss for the year was £221, that the office was untidy and £he books kept in a slovenly and untidy manner; there was no proper system of audit. An advance of £">OOO was made to the Administration for general purposes. There seemed to be no authority for making such advances, "which provides another typical example of the haphazard way in which finances have been generally regarded in the past," says the report. Ineffective Audit.

In the opinion of the report the audit of the accounts of the Administration and also of the Reparation Estates was ineffective. An officer from New Zealand annually visited the territory, but the time alloted for the work did not permit a complete investigation being made.

. In regard to stores the report stated that no proper organisation existed for purchases, which were made without proper appreciation of prices and without careful investigation as to the neeessity for purchase. An an instance of the loose methods, adopted no record was kept of the general stocks of furniture under the control of the billeting officer for use in furnishing the residences of officials.

Apia Park, which belonged to the New Zealand Reparation Estates, cost £888 to maintain last year, and mowing machines cost £312, whereas the revenue was only £233. The Treasury had to find the balance. The principal activities were horse racing, golf and tennis, and the benefit to the natives was negligible. A revision of charges for use was called for, and there should be a drastic reduction in the present burden of taxation. Unprofitable Boardinghouse. The Casino and Cottage, valued at some £14,800, belonging to the New Zealand Reparation Estates and leased to the Administration, was utilised as a boardinghouse for the public and Government officials, the loss last year being £1040. There was no sufficient reason for continuing the use of the place as a Government concern, and it should be sold. A much lees costly scheme could be devised for meeting the requirements of New Zealand or other officials visiting Apia. The sundrv debtors included one senior official of the Administration, who had owed a considerable sum for a very long time. The payment of that account should be insisted upon. Malololelei Rest House was also a losing proposition, the loss last year being £1223, and its maintenance was unnecessary. The report marks the absence of the New Zealand flag except on the Maui Pomare and the Lady Roberts. The Hug had some bearing on prestige, and the report recommended that steps be taken to show the New Zealand Hag regularly at appropriate places. Reparation Estates. Comprising approximately 100.000 acres, mainly of formerly German-owned properties, the New Zealand Reparation Estates, drew forth a good deal of criticism from the Commissioners. The outstanding features, says the report, were:—

(a) The very email return in respect of capital at which the estates stood in the accounts. (b) The manner in which the assets had been used in connection with affairs relating to the Administration. (c) The ineffectiveness of the management and control generally. (d) The absence of an official audit of the financial transactions. The Teport went on to criticise the management. A serious aspect of the financial administration of the estates was the extent to which they had become interlocked with the financial operations of the mandated territory. Numerous assets on charge to the Reparation Estates were in the hands of the Samoan Administration, and operations that had no real connection with the estates were being conducted and financed out of estate funds. The report instanced the manufacture and sale of ice and the provision of cool storage and the development and sale of electricity as two examples. The report also called attention to the fact that estates properties leased lo private individuals appeared on the Looks as worth £142,780, and the net rental return was £1540, or approximately one per cent. According to the report the purchase by the estates of native copra on consignment and the purchase of nativegrown bananas was wrong in principle, and should cease.

Future Management. The report called attention to the purchase in England at a considerable cost of steel barges in connection with the banana industry, for which it seemed probable they were entirely unsuitable. Aβ a result of their investigations the commissioners recommended that the Board of Control managing the reparation estates be abolished; that a suitable general manager be appointed from New Zealand; that a competent accountant be appointed; and the institution of an efficient system of internal check and an independent audit. The report gave details of a number of other reforms considered necessary, particularly with regard to management and finance.