LOANS AND DEBTS

Dominion, Volume 23, Issue 256, 25 July 1930, Page 12

LOANS AND DEBTS

Total of £267,383,343

EARLIER BORROWING Small Increase for Year

In discussing overseas borrowing and public debt, Mr. Forbes pointed out that the total public debt at March 31 last was £267,383,343, the net increase for. the last financial year being £3,191,360. The £5,500,000 loan floated in London on May 5 last would be allocated as follows: Public works, general purposes, £4,500,000; hydro-electric development, £500,000; railways construction and additions to rolling stock, £500,000. Th*e net increase in the public debt was much smaller than usual, owing to the fact that £5,379,105 of the £7,000,000 loan of January, 1929, was received during the present financial year. “It may be explained that this £7,000,000 loan'wisely raised by the late Sir Joseph Ward much earlier than was customary, was not drawn upon to meet requirements in 1928-29, but the proceeds were carried forward intact into last financial year,” Mr. Forbes said. The last instalment of the loan, amounting to £1.620,895, was not received until April, 1929, and thus came into last year’s debt figures. The real increase in the public debt on account of last financial year was thus the actual net increase of £3,191,360, plus £5.379,105 carried forward, a total of £8,570,465. Apart from conversion operations, which I will deal with presently, no loan was floated in London during 1929-30. “Including the portion of £7,000,000 added to the debt during the previous.financial year, the aggregate of additions to the debt on account of the year was £11,099,325. This amount was raised for the following purposes:— Public works .... 7,988,250 State advances .. 2,144,07 a Land settlement .. 615,000 State forests 352,000 £11,099,325 “Of this total, £7,000,000 was raised in London, the cost being £5/0/1 per cent., allowing for the redemption of the discount and expenses of issue over the period of the loan. The balance of £4,099,325 came from local issues—£l,677,32s, mostly at 4 per cent, to 4J per cent., from departmental investments, and 12,422,000 from the public, £726,620 bearing interest at 5 1-8 per cent, and £1,695,380 at 5i per cent. The amount for public works, which absorbed the £7,000,000 London loan, provided for the capital expenditure under that heading previously referred to in this statement. “So far as State advances are concerned. I may say that the £2,144,075 shown above did rzit represent the sum total of the additional capital made available during the year, for over £1,000,000 from previous issues was carried forward from the previous year, while the sale of rural bonds —which, of course, do not form part of the public debt —realised £1,114,486. The total amount of new capital paid over to the State Advances Office during the year amounted to £4,340,224.”