STATE DEFICITS.

Auckland Star, Volume LXIV, Issue 136, 12 June 1933, Page 7

STATE DEFICITS.

FINDING FINANCE.

Commonwealth Bank to Advance

£8,500,000

REDUCTION OF SHORTAGES,

(United r.A.—Electric Telegraph—Copyright)

MELBOURNE, June 11The Loan Council communicated with the board of the Commonwealth Bank asking for accommodation to cover the States' deficits for 193.5-34. In reply the board agreed to finance the States' deficits to the extent ot. £5,500,000. Sir Walter Massy Greene, chairman of the Loan Council, announced that the board had desired the council to defer its request for financial accommodation pending the outcome of future conversions by which, it was hoped, considerable relief would be afforded. It is now regarded as likely that the State deficits, which it was originally anticipated would total £9,000.000, will not exceed £7,000,000. The bank has undertaken to discount Treasury bills to linance thesjs delicits and a substantial sum is likely to be available for the continuance of public works. The Commonwealth Government announces its intention of making a special grant of £300,000 to the smaller States, apart from their share of the finance to be provided by the Commonwealth Bank.

IMPROVEMENT IN N.S.W. STEVENS' YEAR OF SERVICE. SYDNEY, June 11. Since the present Government of New South Wales was elected 12 months ago unemployment has been reduced 25 per cent and dole relief has been reduced 50 per ccnt. Tho Government's indebtedness overseas has been brought do;vn more than £1,000,000 a year. It is a.nnounced that in the ensuing 12 months more than £7,000,000 will be devoted to unemployment relief works, which it is hoped will still further stimulate business activity.

BAY SHIPS' PURCHASE. MR. BRUCE REPLIES TO CRITIC.. LONDON, June- 11. In reply to the speech made by Mr. Cauty, chairman of directors of the White Star Line at yesterday's annual meeting, when lie criticised the Australian Government's enforcement of its Bay Line sale contract, the Australian Minister in London, Mr. S. M. Bruce, said seven vessels, which had cost £7,000,000 to build, were sold to the White Star Line for £1,900,000. When the White Star Line got into difficulties in 1931 a moratorium was granted and no action was taken up to March, 1933, after every effort had been made to come to a working arrangement satisfactory to both parties. The only offer the White Star Line made would have resulted in the payment of a sum less than the annual interest charge, thus the debt would not have been reduced and the asset on which it was secured would have been of progressively diminishing value. In tho circumstances the Australian Government, as custodian of the rights and interests of the Australian people, had no alternative but to direct that the ships be sold.