Manawatu Evening Standard. WEDNESDAY, JANUARY 30, 1924. EXCESSIVE BORROWING.

Manawatu Standard, Volume XLIV, Issue 929, 30 January 1924, Page 4

Manawatu Evening Standard. WEDNESDAY, JANUARY 30, 1924. EXCESSIVE BORROWING.

Tiie danger oi' overstraining the public credit by the excessive expenditure of loan moneys was brought prominently before the public of New South IV ales, a fortnight or so ago, when the Colonial Treasurer was waited upon by a deputation from the Trades and Labour Council, and urged to intervene to preven; the dismissal of employees in the sei vice of the Sydney Harbour Trust. Mr Lang, the leader of the State Parliamentary Labour Party, asked that tha Treasurer (Sir Arthur Cocks) should make more money available in order that the Harbour Trust commissioners might be able to retain the services of 55 labourers and 12 skilled artisans, whq were to be dismissed the following day. He pointed out th it prior to the advent of the last Labour administration the trust had allotted to it £258,00(1 per annum. He, as Colonial Treasurer in the Labour a '.ministration, gave the trust £492,0(0 during his first year of office, and obtained a vote for i;423,000 for the year 1922. The Fuller Government, lie pointed out, had reduced that amount to £279,000 during its first year of office, and had made a further reduction to £173,000 for the current year, and it was, as a consequence of these reductions, that the trust was compelled to dismiss so many of its employees. in iris reply. Sir Arthur Cocks pointed out that the actual vote for the current year had been £ ;2U,000 and that the Government hid since made another £55.000 available, so that the Harbour Trust actually had £275,000 to work upon this year, and it was not possible for them* tc go beyond that amount, there being a i obvious limit to the borrowing powers of the State. ‘‘We cannot borrow, borrow’, and borrow,” he said, ‘‘without seeing in front of us a spectre of the lime when w r e will not be able to meet our obligations.” He went on to say that the loan estimates for the yea • wore within measurable distance o' £11,000,000, and that there were works for which tire people were crying < ut, but “as Treasurer, he had to reinsj to find the money for them, because it could not be done,” as “it would by practically killing the goose that lays the golden eggs.” Borrowing has been carried to such an extent by the New South Wales Government, and on such ill-advised conditions bv past administrations that this year the Fulls r Government finds it necessary to go on 1 o the market to meet redemptions and loan estimates averaging £3,000,0000 per month for tho next twelve i lonths, and the Federal Government is also planning a loan of £20,000,000 to meet soldiers’ gratuities. Sir Arthur might have added that the Labour Government, in which Mr Lang filled the Treasurer’s position, hail so enormously increased the loan expenditure that it was actually responsible for the dismissals that were occurring ; for, in 1920-21, it had actually spent £14.701,028 out of loans, and another £10,442,732 in 1921-22, so that its average yearly loan expenditure had amounted to over twelve and a half millions of borrowed moneys. During t!ie last year that the National Government held office the loan expenditure was less than four millions and for the three years 1915-17, 191718 and 1118-19 the average was a little over Jive millions per annum. The mischievous part of the business appears to be the effect of the increased expenditure under the Labour Government in restricting the number of skilled workers available for outside employments; indeed, it was part of >• Lang's complaint that the dismissals that had taken place were made with a view to easing the employment market outside, and doing away with the competition for skilled workers s> as to clear the way for

wage reductions. The enormous expenditure of loan moneys by the Labour Government could not fail to have its effect upon the labour market, by withdrawing w’orkers from the legitimate avenues of trade. When the necessity arose For Bringing these loan expenditures within reasonable limits, it was inevitable that dismissals must take place from Government and Gov-ernment-subsidised services. The spending of borrowed moneys is an easy enough matter; the repayment of such moneys is more difficult and, with the spectre ahead of him of loans falline due, and estimates to be provided for at the rate of three millions per month, for the present year, Sir Arthur Cocks could only offer Mr Lang and his fellow’ deputationists the cold comfort of sympathy, which was unaccompanied by any prospect of relief.