THE H.B. TRIBUNE. FRIDAY, SEPTEMBER 29, 1922. A NEIGHBOUR’S TROUBLES.

Hawke's Bay Tribune, Volume XII, Issue 245, 29 September 1922, Page 4

THE H.B. TRIBUNE. FRIDAY, SEPTEMBER 29, 1922. A NEIGHBOUR’S TROUBLES.

While the realisation, when we are in trouble ourselves, that our neighbour’s troubles are little, if any, less than our own is no cause for self-gratulation, it still has the virtue of, at any rate, inspiring something in the way of resignation and of stifling the irrational envy which is at the foot of very much of our discontent. Sydney papers just to hand contain some details of the Budget presented by the New South Wales Minister of Finance and these show' that, likg ourselves , the Mother State has to square a heavy deficit in the current year’s estimated revenue by resort to accumulations gathered in more prosperous times. There, too, in order to help ends to meet, some drastic revisions have had to be undertaken in the Civil Service, and the cry is still for yet more reductions in departmental expenditure, and for the Government to confine itself still more narrowly to the proper functions of governing. A notable document, running in many respectsmuch on the lines of that presented by our own Auditor-General,, is the report submitted by Mr. Coghlan, the corresponding officer of the New South Wales State Treasury Department. In his introductory remarks he says that a study of the Treasurer’s accounts should give due appreciation of the gravity of tfic situation, and should make for readjustment of points of view which have been inimical to reduction in expenditures. After mentioning that the total accumulated deficit at June 30 last the end of the. Australian fiscal year—was £3,578,262, the AuditorGeneral says: “A factor of prime importance is our constantly increasing interest bill. Ten years (ago our Slt.;(te inteiregt -payment, which was then a little over 31 millions sterling, was regarded as of alarming proportions, but in the year just closed we paid over 7| millions of interest on our borrowings. This increasingly heavy load must always be reckoned with ar absorbing the firstlings of our revenue. We have assets for the principal, but the interest the State must earn and pay. Another factor is that of which we have now abundant evidence, namely, that the measurable limit of income taxation is being reached. This has been brought about by the dual payments of our citizens, who not only have to meet State requirements, but also contribute their moneys to meet the extraordinary expenditure of a Federal control. The State is suffering the effects of over-taxa-tion, and calls for the restraining power of balanced expenditure. The over-spending of the past stands as a warning for the future.” The New South Wales. AuditorGeneral has in this report made a a very valuable suggestion, the basic principle of which should commend itself to the consideration of our own Administration. He points out that something more than the audit of the mere accounts of the State is needed. Over and above that audit, which is essential, an audit of efficiency is just as essential. He puts to himself and the Government the question. “Can such audit be obtained?”, and answ-ers decisively in the affirmative. The Auditor-General, he says, sees to it that the money spent is spent as Parliament directs, and that account is given of every penny received and every penny spent. What is wanted beyond that" is an 1 audit which would not be an auditor

figures, but an audit of men and of methods, to ascertain whether the utmost worth is got out of every penny spent, and whether only work is done which is essential. As he points out, there is expenditure today because there has been expenditure on the same objects in the past. It is no doubt, he declares, this same custom of expenditure which has been in a measure the 'cause of the deficit. And what lie says of New South Wales is quite fairly applicable to our own Gov ernment, and, indeed, to all Governments dealing with funds for which they have only to ask and they have to be found. Incidentally, it may be mentioned that Mr. Coghlan characterises as something farcical the maintenance of the fiction of a sinking'fund while annual deficits are being shown in the State’s revenue and expenditure accounts. “When it is known,” he comments, “that a sum of over £.3,150,000 has been lost for the purpose originally intended by Parliament, the solemn payment and repayment, while necessitated by law, have their absurdities.” The question of abolishing, or at any rate suspending, the sinking funds which are ostensibly being put aside year by year to wipe out both our ordinary public debt and that incurred through the war, is one which should closely engage the attention of our own legislature. Last year the aggregate amount that had to be appropriated to these purposes was well over the million sterling, and that at a time when our industries were being choked for want of funds with which to carry them on. This year, of course, conditions call a good deal more than equally for relief of the taxpayers from the quite unnecessary burden of finding sinking funds which are, in truth, not being really applied to tlie purpose for which they were intended. Beyond the criticism quoted from the New South Wales Auditor-General, we have also the example of the British Chancellor of the Exchequer, who, while regretting the causes of the necessity for doing so, has made no difficulty about suspending the accumulation of sinking funds, excepting only in the case of obligations in respect of which a specific pledge has been given.