The Dominion. THURSDAY, MARCH 8, 1917. OUR FINANCES

Dominion, Volume 10, Issue 3022, 8 March 1917, Page 4

The Dominion. THURSDAY, MARCH 8, 1917. OUR FINANCES

The information disclosed yesterday by the Acting-Minister of Finance (Mr. Myers), concerning the country's financial position, is very reassuring. It is especially gratifying in viow of the statement cabled us to-day showing the looming deficit in the current year's finance- in Australia. Sir John Forrest, the Commonwealth Treasurer, estimates the revenue for 1916-17 at £32,909,290, and tho ordinary expenditure at £28,639,455. The war liabilities, which must be met out of revenue, however, are not taken into account in these figures, and on the actual year's working, a; deficit of over two and a half millions is expected. This deficit will bo more than met out ol the ■previous'year's surplus revenue, but the fact that cannot be lightly passed _ over is that current revenue is not expected .to balance current expenditure. Both revenue and expenditure have increased to a striking extent, but especially the expenditure. In New Zealand, as Mr. Myers shows from tho figures for tho eleven months of the financial year already expired, we have been more fortunate. Up to the end of February our revenue amounted to £13,252,525, and our expenditure (including war liabilities which had to be met out of revenue) £11,889,838. Thore is thus a balance on the right sido of £1,362,687 for tho eleven months... This is very satisfactory so far as it goes. It should be borne in mind that for the year ende'd March, 1914-15, tho country's revenue totalled only £12,451-,000; in 1915-16 it had jumped to £14,500,000, while this year it promises to reach something over £15,000,000. Last year there was a surplus of a littlo over two millions; this year there m promise of a surplus amounting to a million and a naif, possibly more.. There is, of course, another side to the position. Tho very heavy increase in the revenue returns is the rcsult_ of war taxation—heavy war taxation. No one in tho circumstances can fairly begrudge this extra pull ■ on their pursc-stringa, and, generally speaking, there bab been little complaint en that score. •What has to bo borne- in mind, how- j ever, is that while the war taxation may bo regarded in some measure as a temporary necessity, it is not by any means likely that the cud of the war will sco tho end ot this special taxation. On the contrary we can bo confident i.h;.c many yuare will elapsu eic tho country will be able to rovcrli Lo Anything approaching tho taxation a" pro-war days. The expenditure sido of the account, which has bcess creoping up, wi'il not drop with tho j cad of thu war. Thy Actihg-Minjs- j tee of Finance, it, his common f* or. | the figures for tho eleven months i just onded, pointed out that there had been a.n increase in the cnnua-l expenditure of over £1,000,000, ajid

[he added: _ "This, of course, is almost entirely duo to expenditure on interest and sinkiug fund, war (pensions, war bonus, etc." Tho payments on account of interest and sinking fund and other war obligations will go on increasing while tho war lasts, and will continue to exist long after the war .■has ended. So far as tho present generation is concerned they are in the nature of a. permanent obligation. We direct attention to this aspect of the financial situation at tho present; timo merely to emphasise what we have so frequently stressed, and that is the need for the utmost care and economy in the administration of the country's affairs. Our flourishing revenue affords no warrant for extravagance or loose spending of any kind—it is' to a large extent artificially created by .special war taxation, which everyone expects to see modified at the earliest possible-, moment after the close of tho war. Mr. Myers mentions with some satisfaction that the ordinary Departmental appropriations have increased during the eleven nionthsi by only £11,578. There- is some ground for satisfaction over the very moderate increase here shown, for the tendency has been for a long time past to increase these appropriations, sometimes to a most disquieting extent. But there is, wo fear, littlo ground for congratulation in tho saving of some £200,000 in tho cost ot the working .Railways JJopartmjenfc. This saving probably has been made at tho oxpense of the general working condition of the railways, and as such might well bo regarded as false economy. In view, of tho fact that tho Railways Department' has experienced great difficulties in securing material for ]ts purposes since the war started it would be unfair to blame anyone for this, but the circumstanco h<s s to he taken into account in arriving at a judgment as to the true position. The money coiupulsorily saved now in replacements ■ and maintenance on tho railways is only saved temporarily, and the work ultimately will in all probability prove the more costly because of tho delay.