PRUDENCE NEEDED

Evening Post, Volume CVII, Issue 129, 5 June 1929, Page 12

PRUDENCE NEEDED

COUNTRY'S FINANCES

SURVEY BY PREMIER

ENTHUSIASTIC RECEPTION

(By Telegraph.)

(Special to "The Evening Post")

AUCKLAND, This Day.

• In. the: political history of Auckland . few Prime Ministers havo been, pai'ii-such a warmhearted compliment; as was given the Eight Hon. Sir Joseph Ward last evening, when the Town Hall was filled to overflowing half an hour before the opening of his pre-sessional address. There, was a spontaneous outburst of cheering a^ the popular' Liberal Leader entered, the .hall, led by pipers soundingan enticing skirl of ■welcome. Scenes of enthusiasm were witnessed both when the Prime Minister rose to speak and at the close of a remarkably lucid survoy of the political situation, which occupied an hour and a half in its • delivery. \l Sir Joseph, proceeded along the lines of record of stewardship, claiming that the Government had fulfilled in part every election -promise, and was continuing towards the complete fulfilment of every pledge given.

Following the unanimous endorsement of a resolution of thanks and confidence, the great audience rose to: cheer,, and sang ''For He 1! a Jolly Good Fellow." So ended one of the most memorable political demonstrations in Auckland.

Dealing with the national accounts, Sir Joseph said that revenut and expenditure figures of the Consolidated Fund for, the last financial year had now been audited. Tho revenue amounted to £23,599,676, and the expenditure to £24,176,928, leaving a deficit of £577,252. Customs, which, is the mainstay of 1 the revenue, fell short of the estimate by £307,00 largely due to the falling off iv duty collected on spirits. Income tax. was short by £89,000, and land tax by £10,000. The former, of course, was a reflex of the tardy, recovery of the ■ trading position, while,the drop in land tax was a, result of the adjustment of count} valuations and.subdivisions of estate 3. Beer duty exceeded the estimate by £11,000, and the interest on railway capital by £76,000, but. on all other, items there was a net shortage of £41,000, the outcome' being a shortage of £360,000 in the total estimated revenue.

The balance of the excess expenditure was spread over numerous items, among them being war .pensions; £38,000; old age pensions, £29,000; losses on branch railway lines, £ll,00p; Samoan Police Force, £25,000. The last was an entirely new item. The increase in the expenditure camefrom items that could not be curtailed.

In connection with interest, the London conversions of 4 pc- cent, consolidated ■ stock, when carried to completion by November next, would inevitably lead to further in-i-cases in interest charges, and tho whole operation would mean a permanently-increased charge of-about £220,000 a year. This, with the normal annual increase for social services,- such as education, war, old age, and other pensions, created expenditure that could not be reduced.

POSITION MITST BE RECTIFIED. "The reputation for balanced Budgets is a very considerable factor iv the Dominion's high standing financially, and to safeguard this this present position must bo rectified without deJay," continued Sir Joseph. "Revenues are" inadequate to meet the increasing' charges that I have referred to, and the Government would be failing in its duty if it did not take steps to adjust taxation and augment the revenues."

Claiming that the Government had done a great deal within the few months in which:it had been in : office, Sir Joseph said: "We promised during the election campaign wu would stop the system of bringing parcels into this country from England on the cash-on-delivery system, and we stopped it. Wo promised cheap money for settlement and for workers, and wo have done it. We promised to investigate the construction of the railways, and we have commenced it, but we have not finished if. (Applause and laughter.)

I claim that every promise made has been fulfilled in part, and we arg going on in tho direction of totally fulfilling all promises. "Important legislative proposals will he placed before Parliament for the acquisition of estates for settlement, supply of cheap money, and other matters." CHEAP MONEY—SALUBRIOUS EITECT, In ' order, to show that the Governmentfs policy had reacted beneficially upon 1 the commercial life of the country, Sir Joseph stated that money .-was now -being borrowed privately in Christchureh at 6 per cent. " There was now'no end, of money in, the country seeking investment, and his advocacy of cheap money had a most' salubrious effect upon the country. Cheap money ■was essential for -the man.on the land, for tho man in the town, 1, and for those who had not got it. (Applause and laughter.,). . Repeating his' assertion that the cardinal feature of his election manifesto had been put into operation, tho Prime Minister reminded his audience that'he had gone to the country promising to borrow £.70,000,000. He had been misrepresented throughout the country in that connection, but he had gone on with the advocacy of that loan, and he Btill believed it was necessary to have £10,000,000 of borrowed money for the completion of long lines of Tailway, ana £60,000,000 to" enable settlers and "workers to have farms and homes. He had proposed to borrow at 4% per cent., but'on assuming office ho had discovered that: ho was confronted with the necessity, df: converting £18,000,000. Not.'only_;did he succeed in converting that almoiint, Tjut he also raised £7,000,----000 aft'4i per "cent. None of that money had so been touched. (Applause.) i WITHIN REASONABLE LIMITS. "We.have got £7,500,000 availablo, but it is riot nearly enough for this country's needs,'? said Sir Joseph. - "However, we must trim our coat to our cloth, and as far as finance is concerned we must stay within reasonable limits. When it is remembered that we have .hydro-electric works costing £900,000 a year, additional railways costing £1,400,000,' and Public Works

all costinglarge additional sums, it will

be, seen that the demands on the public purse,are heavy. Two railways have been stopped—(applause)—and • there-

by. sin expenditure 1 of £1,400#00 saved. Both stoppages were,justified, but when you com© to assess the amount of money required, at the speed we are now travelling at, t £'23,000,G00 per annum would fee required to meet the demands on the Treasury. Common-sense suggests to everyone that it is not possible for New Zealand to acquire £23,000,000 a year. "What we have to do ia to extend the period over which expenditure is to be made.

"NO USE BEING IN A HURRY." "It is of no uso being in a hurry, although everj'one seems to be in a hurry in their requests for money to carry out large works. We cannot be in a hurry when there 1 is a deficit of

£577,000 -arid all the superannuation funds are requiring investigation." "We are met by deputations urging new railways—railways which they want to have pushed on too swiftly. Wo can't go on borrowing at the rate we are doing. It is more than the country can stand. ''limy hand I have a statement of the applications made to me for works which people want carried out, but which could not be done. The tbtal amont involved is £23,000,000. Now, if anyone can blow £ 7,000,000 into providing £23,000,000, I say to him, 'Come and join the Ministry.' (Laughter and applause:) I can't do it, the Government can *:t do it, and no one can do it." ■■.-■-- .'■'•'••■ .;■■•■! A voice: "You could do it before the election." . r Sir Joseph Ward: "Oh; no. Before the election I announced £7,000,000 as theamount. of my proposed loans, but that was for the special purpose of lendißg to persons who would go on farms and make homes, thereby contributing •to the prosperity of the country. It was not for roads and" bridges and otherworks. ': .'."/." more cheap money will be :: . ■..■ ■.;• ■':-■: got. .■■ ■". -■ ■'■■ "Cheap money was characterised as a bogus proposition when I first brought it forward,' 5 continued the Prime Minister, "but we have shown that it can be provided. We have done what we claimed could be done. We have got £7,000,000 to-day, borrowed at 41 per cent., waiting for expenditure "this year. We want more, and I am going to say we will got it." (Applause.)