DEFICITS.

Press, Volume LXIV, Issue 19363, 16 July 1928, Page 9

DEFICITS.

AUSTRALIAN FINANCE.

FEDERAL TREASURER'S NEW EXPERIENCE.

(nOK OUB OWN COBEKSPONDEST.)

SYDNEY, July 6.

Deficits are quite a common occurrence in Australian Government finance, but even so it cannot be denied that the public is a little uneasy at the fact that the Federal Treasurer (Dr. Page) for the first time since he took office five years ago, will show a balance on the wrong side of the ledger Official figures are not yet available, but it can be stated with certainty that the Federal deficit will exceed £3,000,000. \ Customs receipts have been almost entirely responsible for the serious fauing off in revenue. Postal receipts and Customs revenue together will be more than £3,000,000 less than the Treasurer estimated. This will have a serious effect-on the policies of the States, who in the past have acted in a manner suggesting that they knew quite well the buoyant nature of the Federal revenue, and that the Federal Government would come to their assistance if they found themselves in serious difficulty. The Federal authorities have, in fact, assisted Tasmania, and Western Australia, and the recent financial agreement means that the Commonwealth will contribute to tno State £1.000,000 more annually than it did under the old per capita system. Now the Federal Government, generous in the past almost to a fault, is forced to explore every avenue of saving in order to avoid increasing taxation. And this at a time when it was confidently hoped that very soon the Commonwealth would be able to evacu ate the field of direct taxation. The Budget that will be brought down later will anticipate a continuance of low Customs receipts. In view of the Federal Loan Council's decision to restrict* borrowing. Departmental estimates have been deferred, aad instructions have been to reduce them as far as possible. Instructions have gone forth that every means of curtailing expenditure must be adopted. Nonessential works will be deferred, and the amounts provided for the development of Canberra will be reduced to a sum sufficient to maintain essential services; and to provide office and livinir accommodation for the staffs. The New South Wales financial year closed last Saturday, and it is estimated that the deficit will be between £1,000.000 and £1,200,000, which u about £400.000 less than the amount estimated by the Government some months ago. The improved accounted for by the general improvement in the finances of the State during the last few months.