"Finances Balanced By Small Savings”

Press, Volume CII, Issue 30216, 22 August 1963, Page 5

"Finances Balanced By Small Savings”

(New Zealand Press .Association)

INVERCARGILL Aug. 21. It was a sobering thought that in a year of record national income the Government finances were balanced only by appropriating a surplus arising from small savings, the chairman, Mr F. K. Knox, told the annual meeting of the Invercargill Stock Exchange, this morning. ‘•ln the strange method of Government accounting this is treated as income, thus ignoring the possibility that at any time the flow could be reversed in which case the deposits become a liability.’’ he said. “The ostrich-like belief which considers that we shall be able to maintain high internal levels in the face of a prolonged and serious external deterioration, without making prior provision, is limply not facing unpleasant possibilities.” Mr Knox said the country needed a climate of private enterprise which could only be created by a reduction of taxation, both personal and company taxation, so that those who were prepared to shoulder responsibility and work were not penalised for doing so.

The prerequisite to any tax reduction in the present circumstances must first be a critical examination and a substantial pruning of Government expenditure. It seemed that in budgeting on current methods, expenditure was added up and then a search was made for ways of increasing revenue to match expenditure, which

was putting the cart before the horse. There should be an absolute ceiling on Government expenditure each year so that the surpluses arising from unexpected good seasons were not squandered on unnecessary and unauthorised expenditure, he said.