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THE FINACIAL POSITION., Issue 10445, 15 October 1897
THE FINACIAL POSITION.
If the sentiments expressed by the right honorable gentleman who is not only the head of the Government but <fe facto, the Government itself were only, substantiated in his policy and methods New Zealand should be in a very healthy condition, financially and otherwise. In opening the Financial Statement he declares it to be "a matter for sincere congratulation and rejoicing for me to announce" (we are not responsible for the' grammar) "a buoyant revenue and healthy exchequer," and "that the soundness of "pracV rising strict economy.- and main.'.'taining ' a strong, finance has been " abundantly demonstrated "! He .then proceeds tp_philesophise' ix "economy and . the "lessons , taught by past extravagance." This, if we may so express ourselves without offence, or without any idea of personal application, is at least suggestive of" Satan reproving sin !" The financial' results of the year 1896-97 show ,a surplus of £354,286, which is made up of the. balance of receiptsoverordinary expenditure, amounting to £l3B, and the balance from the pre-; ceding year, £216,558. This is satisfactory as. demonstrating the elasticity of the. revenue and the ability of the people to bear the heavy taxation which has been imposed under the rule of the new Liberals. Compared, with the actual receipts of the preceding, year, the revenue of 1896-97 shows an increase of £327,427. Sir Edward Stafford once stated in the House that "taxation was the test of civilisation," and, if this is to be accepted as '.an .. axiom, New, Zealand must be approaching a very high standard pf civilisation, considerably, indeed, above that of the Mother Country. A consideration of more immediate moment to the country- than the substantial surpluses carried on from year to year, but never available for the reduction of taxation, is the steady growth of the ordinary expenditure. Comparing the actual expenditure of 1896-97 with that of 1895-96, we find an increase of £139,500. Intereßt and sinking fund show an increase of £25,699, of which £17,500 represents interest at 3J .per cent, upon the half-million of inscribed stock issued for the purchase, of a like amount of Bank of New Zealand preferred shares. Under the annual appropriations there is a increase of £114,246, but "eliminating the increased cost of "education, which is fixed by Act, and the " working expenses of the railways, the. increase is only £75,195," and of this sum, the Treasurer states, £68,200 was expended for extraordinary services—the net result showing that " the ordinary " services of the departments have been "carried, on with the greatest economy, "and even at a less expenditure than in "the preceding years," which is notthecase according to his own figures. The estimated expenditure for the current financial year is set down at £4,622,843, representing an increase of • £112,862 over! thd expenditure of 1896-97. In two years, therefore, however it may be explained, the increase of expenditure is £252,362, and to this has to be added the amount of the Supplementary Estimates for the current year, which have not yet been brought down. It is significant that, although the revenue is estimated at £4,723,400, and the whole receipts for the year at £4,793,000, the Treasurer proposes to raise £50,000 for educational purposes and £200,000 for the improvement of the working railways. It seems sufficiently clear that the ideas of the Government as to economy are, despite the professions of Mr Seddon, exceedingly limited, and that their conception of "a sound finance" is sweating the taxpayers to the point of capacity, expending moneys even beyond what is thus contributed, and making up the balance by borrowing. A plain. business statement of the Public Account would, we think, be an awakening document. Does anybody, outside the Cabinet and the Treasury officials, know how'the Colony really stands ? Whilst the annual'" increase of the ordinary expenditure is assuming alarming proportions,.and there is demonstratively no intention of retrenchment in any direction, but, on the contrary, the army of officials is being augmented almost day by day, the permanent charges are steadily accruing owing to the enlargement of the colonial indebtedness. On March 31,1896, the net Public Debt was £42,271,889, and on the 31st March last it was £43,552,324, showing an increase .of £1,280,430. Between March 31, 1891, and March 31, 1897, during which, period a * nonborrowing Administration has been in power, the Public Debt has been increased by £5,536,268, of which total the Treasurer states that £4,622,500 has been borrowed for reproductive purposes. Whether the money' has been thus expended and with what results as to 'reproduction is .. quite another matter, and one about which grave doubts may be entertained. One thing is beyond question namely, that the Colony is directly responsible for the principal, and will have to meet the annual charges for interest. There are further contingent liabilities under the banking legislation of the last three years to which Mr Seddon did not find it convenient to refer. Public anticipation has been somewhat'disappointed in that the borrowing proposals for the current year are so moderate. A public works loan of ' sufficient amount to complete railways in course of construction has been for some time shadowed, but is not to come pff, it would appear, this session. Possibly, however, more may be heard, of this question anon.- .
THE FINACIAL POSITION., Issue 10445, 15 October 1897
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