Works And Capital Spending Up £lBm.

Press, Volume CIII, Issue 30477, 26 June 1964, Page 1

Works And Capital Spending Up £lBm.

(From Our Parliamentary Reporter)

WELLINGTON, June 25.

A further £lBm is included in works and capital expenditure in the Budget, bringing the estimated total to £l3lm.

It includes another £4m for electricity supply projects.

Mr Lake said the demand for electricity for all purposes continued to rise, and to ensure an adequate supply the Government must press on with the projects now under construction or investigation. A high level of capital expenditure was involved, and £2Bm was being provided this year. Included was the bulk of the cost of the Cook Strait power cable, which was being bought overseas. A loan of £11.6m from the World Bank would meet most of the overseas cost of the project, and it was expected that- £B.sm would be drawn- during this financial year. As well as the £12.7m being provided for education buildings (up £2m), £6.7m was being provided for public buildings. This included £l.3m for State hospitals, £l.sm for post offices, and £625,000 for penal institutions. State Advances Mr Lake said that £23m was being made available to the State Advances Corporation for financing home owners, farm development, and some local body housing schemes. This was an increase of £4.5m on last year’s figure, mainly to provide more finance for agricultural development. Although the finance working part of the agricultural development conference had not found any shortage of loan finance for seasonal or developmental expenditure, it had recommended that more money be made available for lending by the Marginal Lands Board. The board’s

resources would therefore rise by one-third to £BOO,OOO this year. Mr Lake said the Government felt it was justified in relying on loans raised overseas as well as in New Zealand for a considerable pro-

portion of the increased outlay on the works and capital programme. Governments in New Zealand had always played a major role in the provision of essential services such as power, transport, and communications. This had often involved, as it did this- year, the financing of exceptionally large projects which would make substantial contributions to the country's economic and social well-being for years to come. Mr Lake called for a full response by investors to Government loans. Civil Aviation Mr Lake said that capital expenditure of airport and airways development would reach a peak of £3,7m this year, with some tapering-off over the next two or three years. In the past the full .amount had been met from revenue, but this year £2m of the cost would be borrowed. -A new .vote for that purpose would be established in the works and trading account Mr Lake said the Government considered that in this peak year of expenditure part of the cost should be met from loans, particularly as airports represented fixed major national assets.