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Public Works

The most satisfactpry part of the budget statement, as it relates to public works, is the very clear evidence that the Government has in practice and theory finally abandoned the old "developmental value" argument in justification of any and every kind of public work, whatever the capital cost, the annual charge, and the annual visible loss. This appears not only in the account of schemes that' have been approved and set on foot in the immediate past but in the definition of future poliqy, which shows a distinct advance towards the sound method of drawing up a long-term

programme in accordance with the results of an economic survey. The Minister for Finance explains that works have been divided into two classes: those expected to be, or to become, reproductive, and those of which no such expectation is possible. Only the first class has been financed from loan money; the second has been financed partly from revenue, partly from Unemployment Fund subsidies, as the merits of the project and the need for relief works seemed to require. As Mr Coates says, such a policy will offset increases in debt charges by the value of increased production; and it will be acknowledged that the principle of discrimination and the result of acting upon it are desirable. Later in the statement Mr Coates observes that " the time has now arrived "when it is desirable to formulate a .long- " range public works programme. . ... . To "provide the basis for such a programme it is " proposed to undertake a survey of suitable " developmental works." This will facilitate the preparation o'f a programme in order of urgency and resting upon estimates of cost, return, and labour demand —an object entirely to be approved; but it is not at all easy to see why "the time has now arrived." It arrived very long ago, and the c&untry has wasted and lost millions of pounds because the truth has been ignored. ■ The schedule of works sketched in Mr Coates's statement and detailed in the estimates has of course been designed without the help of such a survey, but is not imprudent The remission of 2d in the special unemployment taxation is evidently made possible as much by the expansion of public works expenditure as by the buoyancy of the revenue from this tax. More men will be employed at standard rates, and though the Unemployment Fund will, subsidise some works, revenue is expected to be quite sufficient to maintain the reduced number of men on relief works and sustenance. There is no reference, many will regret, to any proposed improvement in the condition of this last and considerable section of the unemployed; but this is not to say that none is being considered. The Minister for Employment rather than the Minister for Finance, perhaps, should properly make such an announcement. The gross expenditure provided for is £5,630,000, nearly £1,500,000 more than in 1934-35; but the amount of loan money to be expended is very much smaller and is already available without public issue. The rest of the money is provided for by unemployment subsidy, departmental resources, and Highways Board revenue, principally. Motorists will welcome a considerable increase in expenditure on highways maintenance, improvement, and construction; but they may tell themselves, if they stop to think about it, that it is, after all, their own money that furnishes the increase: the £320,000 retained in the consolidated fund last year from the Highways Board's share of petrol tax revenue will not be retained this year. Otherwise the estimates do not yield much of special interest, though the amount apportioned to school buildings, £IBO,OOO, is in view of the state of many old buildings and the need for new surprisingly low. It is generally true that the Dominion may commend the expanded programme, not merely for its probable effect on but because cheap money and unemployment subsidies enable it to be carried out at an unusually low capital charge.

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https://paperspast.natlib.govt.nz/newspapers/CHP19350918.2.52

Bibliographic details

Press, Volume LXXI, Issue 21581, 18 September 1935, Page 12

Word Count
659

Public Works Press, Volume LXXI, Issue 21581, 18 September 1935, Page 12

Public Works Press, Volume LXXI, Issue 21581, 18 September 1935, Page 12

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