FEDERAL FINANCE.

Hawera Star, Volume XLVIII, 3 April 1929, Page 8

FEDERAL FINANCE.

HEAVY DEFICIT EXPECTED. DROP IN CUSTOMS REVENUE. SYDNEY, March. 21. Well-informed circles at Canberra expect a huge Federal deficit this year. Certainly members are agreed that tho Treasurer, Dr. .Page, will have anytilling .but# ib cheerful story to tell when lie presents his Budget, probably next August. The financial year ends at June 80. and unless a marked improvement is shown during the remaining three months the receipts are bound to fall far short of the expenditure, and there are definite indications that tho deficit will lie between £3,000,099 and £S,OUO,OIX>. Last year Dr. Page admitted a deficit of ' £2,690,000, but tho AuditorGeneral, that fearless critic of Governments, said that the actual shortage was £4,209,000. A half-yearly financial statement issued by the Treasurer shows a surplus of £820,000 for the six months’ working, but this cannot be taken as an Indication of the probable position at the end of the year. The real test is a comparison with the previous half-year’s statement, which shows that Dr Page is really £2,000,000 to the had on the figures for the half year ended December 31. Although showing a surplus of nearly £3,000,000 for the first half of 1927,28 lie finished up with an admitted loss of ,£2,600,000, so that the outlook for the current year cannot be regarded as reassuring. Customs and excise, which contribute about three-quarters of the Federal revenue derived from taxation, continue to show a serious falling off. Compared with a similar period last year the figures for the first half of the current financial year, under this head, have decreased by £i,296,000. figures issued to the end of February show that for the eight months of the present financial year Dr. Page’s estimate of the customs and excise revenue was more than £1,000,000 short of the actual revenue. Post Office revenue was £350,000 below the estimate, although showing an improvement. In presenting the Budget last year Dr. Page estimated a nominal surplus, of only £13,000. Actually, it is claimed, he was budgeting for a delieit. Owing to a general slackness of trade it is”not anticipated that the income tax will cover the shortage in the customs revenue. The shrinkage of customs revenue is not so much due to the shutting out of goods by a high tariff, as to a substantially reduced volume of trade in all directions. During the year the Government expenditure lias not been reduced, so it is fairly obvious that there must be a delieit. Another deficit is not likely to improve the position of Dr. Page or the Country Party which bo leads, and there is bound to be a renewal ol the demand that the Nationalists should cut adrift—that the existing coalition should be swept aside. Discussing the position in the House of Representatives last- week, Dr. Page said that sources of revenue other than the customs, taken as a whole, would produce a result approximately equal to the Budget estimate. The final balance for the year would, therefore, be almost wholly governed by the total of customs and excise receipts compared with the estimate. For the first eight months of the year to the end of February this deficit was approximately £1,000,000, but as the general trading position was now more favourable than it was earlier in the year. it was possible that much of the leeway would be made up.