Cost Of Aid Scheme

Press, Volume CVIII, Issue 31831, 8 November 1968, Page 15

Cost Of Aid Scheme

(N Z. Press Association) ' WELLINGTON, November 7. Few economists would recommend a three-fold increase in New Zealand’s foreign aid programme, said Mr W. A. Poole, an economic research officer.

It would mean paying out about s4om a year and would probably involve some form of increased taxation, he said. The increase may be sought by the Presbyterian Church, according to the retiring convener of its international affairs committee (the Rev. O. Robinson). The Church’s general assembly in Auckland has resolved to circulate a petition calling for the National Development Conference to allot 1 per cent of the gross national product to foreign aid. Mr Poole, treasurer of a PrebsyterianChurch group, is on the staff of the New Zealand Institute of Economic Research.

“One per cent sounds very little, but it amounts to about $4O million,” he said. At present, this country pays out about J per cent of

its gross national product in aid—more than slom. “Few countries in the world could sustain 1 per cent of their gross national product in foreign aid for any substantial time,” Mr Poole said. 5 p.c. of Exports New Zealand depended on its export earnings, yet such an aid programme would require about 5 per cent of its export earnings. This could have the effect of depressing the economy, he said. If New Zealand had been giving 1 per cent to foreign aid over recent years, it would be in a vastly different economic state today. If New Zealand paid out 1 per cent in 1968 and 1969, the balance-of-payments deficits would rise from sl66m to $249m according to figures prepared by the Institute of Economic Research. An alternative scheme, suggested by Mr Robinson, was to expand vastly the training of Asian, Pacific and African students in this country. But Mr Poole thought this would tax further the already overloaded educational system. An Alternative One alternative could perhaps be to expand the Volunteer Service Aboard scheme, he said. If taxes were introduced

to help meet the cost of higher foreign aid expenditure, it would probably decrease the generous private contributions through churches and welfare organisations.