The Dominion. WEDNESDAY, JUNE 14, 1916. WAR FINANCE

Dominion, Volume 9, Issue 2796, 14 June 1916, Page 4

The Dominion. WEDNESDAY, JUNE 14, 1916. WAR FINANCE

Ministers have becu extremely reticent regarding the contents of the 1916 Budget, which, it is understood, will make its appearance on Friday night. There has been a good deal of speculation in political circles as to its probable new features, but _ the 'Minister of Finance and his colleagues have guarded their secret very closely, and no real light has been thrown upon the darkness by the occasional references which -Ministers have made to tho subject. Members of Parliament have endeavoured to ascertainthe intentions of the Gov- , ernment in regard to such questions as taxation of war profits, the cost of living, and a local war loan, but Ministors have declined to anticipate events. 'It may safely be talten for granted that Parliament will be asked to authorise further borrowing for war- purposes. New Zealand's war expenditure is at present about £1,000,000' a month. Whether the provision to be made to meet this outlay will include a local loan remains to be seen. There is, however, a very strong feeling in the country that this. Dominion ought, not to look entirely to Britain in the matter of financing its war obligations. It is quite time we shouldered a much greater part of this burden. Australia has set us a_ good' example. Tho war loans raised in the Commonwealth have been an undoubted success. They havo provided an opportunity for the people to do something, ajiart from military service, which will bo of real and direct assistance to the Empire. They havo given the ordinary citizen a chanco of rendering public service of a very practical kind. "'They have given him the satisfaction of feeling that he _is not merely an onlooker in this tremendous conflict, but that ho is actually doing something to win tho war/ The people, of New Zealand are just as patriotic as the people of Australia, and <they are just as anxious' to do what they can to help tho Empire. When _wo think of the enormous financial burden which Britain is bearing so uncomplainingly, we cannot help feeling that New Zealand is not doing all, or nearly all, it could and should do. Britain's estimated expenditure for 1916-17 is no _ loss than £1,825,000,000. Tho estimated revenue is £502,000,000. Ihis leaves a deficit of £1,323,000 000 which will have to bo met by borrowing A glance at Britain's National Debt figures, before the war and since, should impress upon us the. need of greater self-roliance in the matter of war finance. Tho figures are as follow:

Before the war 051,000,000 458,000,000 t . "dded 1,031,000,000 Total on March 31 last 2,140,000,000 -In & full year the debt charge for in-, torost will amount to 95 millions.

A local war loan would certainly bo popular, and all the availablo data goes to show that it would be a great success. The country is wonderfully prosperous. The trade statistics for. the year ending March, 1916, show an excess of exports to the amount of £12,159,960, as com. pared with £7,660,746 for tho previous year. Our export trado is 'being maintained at its highest levol, and there is no lack of employment for our industrial population at good wages. The banking figures recently quoted by the chairman of the Bank of Now Zealand mako it quite plain that a loan of any amount up to £5,000,000 could be raised in tho country without causing any undue or injurious disturbance of the money market." A comparison of the figures for 1916 with those for 1913 reveals that the frco deposits have increased by £5,631,419 and tho fixed deposits by £1,755,378, giving a total increaso of £7,386,797.. Tho following table gives a good indication of the capacity of the community to respond sliould tho Government decide to raise a war loan within the Dominion: —

. Free Fixed Total deposits. deposits. deposits. Mar. 31 £ £ ' £ 1916 ... 19,091,949 12,182,101 31,271,053 1915 ... 15,058,732 10,870,507 26,829,239 1911 ... 13,475,771 10,554,479 24,030,250 1913 ... 13,460,530 10.42£,72G 23,887,250 The magnificent response of the people of France of every class to the Government's call for a "victory" loan impressed the whole world. Those who could not fight were willing to lend their money in order to savo France from the yoke of the llun. The people of New Zealand arc ready to do the same if the Government gives them tho chance. There is enough money and public spirit in the country to ensure the success of a local war loan. It would, of course, be advisable to make special provision to enablo tho small investor to participate. Tho loan should be mado as attractive as possible to the wage-earner and the small capitalist. This would give the mass of the people an excellent opportunity of putting into practice that economy of which wo have heard so much and seen bo

lifctlo sineo the beginning of tlio war. The loan of £2,000,000 raised locally last year for public works purposes was readily taken up. It was understood that tho expenditure of this sum was to be spread over a period of two years, so there should tic? no need at present for further borrowing for public works. This leaves the way clear for a real war loan which would appeal to tho patriotic instincts of the nation.