THE PUBLIC FINANCES.

Dominion, Volume 2, Issue 320, 6 October 1908, Page 6

THE PUBLIC FINANCES.

•Although we have persistently condemned the P hi me Minister's incitements to plunge, and insisted that the country was never in greater need of counsels of prudence, we have at all times refused to join those critics who can see nothing short of financial disaster ahead. The credit of the country is good, and the resources of the country arc great, but that credit and those resources are menaced by the reckless extravagance and improvidence of the Government. The-public is slow to realise a dangerous drift in the midst of prosperity, but nobody can read the figures quoted by the Prime Minister in the House on Friday night without feeling that the public finances are not in a condition that warrants any liberties being taken with the country's credit. For the twelve months ended September 30, 1908, the revenue was £310,473 greater than for the year ended September 30, 1907—by no means a very large increase. But for the six months that ended with tho former date the revenue was only £337 greater than' the revenue for the first half of the financial year 1907-8. The revenue, that is to say, is practically stationary, and the countny may look forward to a very different announcement at the end of the current financial year from that which it has of late grown accustomed to hear. The heads under which occur the decreases that have wiped out the increases under other heads arc Customs, registration and other fees, and territorial revenue. Tho Prime Minister says that tha falling-off of £139,933 in Customs revenue is directly traceable- to the tariff reductions, and this is a statement worth examining. Tho falling-off under this head for the twelve months ended September 30 last was £167,648, so that most of the falling-off has occurred in the past six months. Since the new tariff had been in forco for some time before tho currcnt financial year began—in his Estimates for 1907-8 the Prime Minister "considered it prudent" to make allowances for tho " concessions which it was proposed to make "—tho faliing-off between March and September must have some better explanation than these " concessions." If the " concessions" wtplaia u very thing, thorn uliould

have been an appreciable falling-off between September, 1907, and March, 1908. The decrease really appears to mean a check in importation rather than any great loss through reduced Customs taxation. Whatever the reason, however, the figures quoted by Sir Joseph Ward show a very decided slackening of the pace at which money has been coming into the Treasury. The revenue for 1907-8 exceeded that for 1906-7 by no less than £650,871. In this year's Budget the Prime Minister estimated the revenue at £8,985,000. It must be remembered that it has become the practice to underestimate the revenue in order that the Government may point to the astonishing excellcnce of everything and the way in which their " most sanguine expectations " have been surpassed. For example, the actual revenue for 1907-8 exceeded the estimate by no less than £855,916. To get, therefore, at what the public should expect if normal and healthy conditions prevail, the rule is to add about three-quarters of a million to the Government's strategic estimate. Normally, therefore, the revenue for the current year ought to be the estimated £8,985,000 plus three-quarters of a million, or about £9,700,000. For the six months just ended the sum of £3,829,304 has been collected. Unless the coming six months, therefore, yield about £6,000,000, it will be patent that there has been something very like'a turn in the tide. Arid where is the £6,000,000 to come from 1 It is too much to hope that there has been a corresponding decrease in the expenditure. 1 Tliot has reached the stage of increasing by over £400,000 a year. The figures as a whole arc unusual and disturbing, and their significance should not be lost on the public. The following table appears in this year's Budget: — Excess Year. Revenue. Expend, of Rev. £ & £ 1903-4 ... 7,021,386 6,434,281' 587,105 1901-5 ... 7,282,870 6,635,902 640,968 1905-G ... 7,584,359 7,122,340 462,019 1906-7 ...' 8,399,075 7,774,920 624,149 1907-8 ... 9,055,946 8,213,965 841,981 It is safe to assume that the expenditure for 1908-9 will be £8,500,000. In order to save a deficit, the revenue for the next six months must amount' to over £4,670,000. To maintain the' movement in the above table about £6,000,000 is wanted. Even the optimism of Sir Joseph Ward will hardly carry him une length of anticipating the latter amount being realised.