STATE UN-BUSINESS FACES THE STORM

Evening Post, Volume CX, Issue 39, 14 August 1930, Page 8

STATE UN-BUSINESS FACES THE STORM

"Influences of outside control discounted all efforts by Railway Commissioners to conduct their undertakings on sound business principles," reports Mr. Harold Burston, after a special investigation made into Commonwealth economics on behalf of the Melbourne "Herald." His disclosure of the railway position, as set out in an article elsewhere in this issue, raises the alternative of de-poli-ticalising the railways, or of selling them, and casts a side-light on the Federal Loan Council's discussion on wages, cabled on Tuesday. The slump has driven home what everybody knew —that State employership is ineffective unless separated from politics, and that it would be better to sell State business undertakings than to retain political management. And this applies not only to the railways. The economic crisis is demonstrating how seriously all Government expenditures have got out of hand. A body more scientific and more effective, in control than constantly changing Parliaments, whose policies are necessarily frequently dictated by political expediency, and are consequently hampered in giving effect to remedies that are admitted to be necessary, is essential in order to make adjustments and to effect permanent reforms in the control of all Government undertakings.

Another point emphasised is the need of encouraging of oversea capital to invest in Australia. If oversea capital comes in as an investment, it brings the scientific management that Governments lack, it pays taxes, 'and it prevents over-capitalisation (or it pays the piper); in any case, it takes the risk. But a borrowing, nationalising Government takes all the risk on its own incompetent shoulders, and gives oversea capital an assured, risk-less interest rate, which untaxed and unprofitable State businesses are powerless to meet.