INION FINANCES

Manawatu Standard, Volume XLIV, Issue 1076, 24 July 1924, Page 6

INION FINANCES

.TEMENT BY THE MINISTER.

SUBSTANTIAL SURPLUS SHOWN,

The Financial Statement for the year jricleil on March 31st lost was delivered in 'ho House of Representatives last night by the Rt. Hon. W. F. Massey, Prime Minister and Minister of Finance, in the course of which he said:—l have again tho pleasure to submit for the consideration of honourable members annual statements of account which furnish a record of progress and unmistakable evidence of a continued return to prosperity. The revenue has been equal to expectations, and the expenditure has been kept down wherever possible to do so without loss of efficiency, with the result that there is a substantial surplus of revenue over expenditure. CONSOLIDATED FUND. I estimated to receive during the year a total ordinary revenue of £27,969,000; the actual amount received was £27,960,370, or £8630 short of the estimate, but £380,927 in excess of the amount collected during the provious financial year. The principal increases over 1922-23 were: £ Customs 1,205,923 Railways 234,605 Marine 40,355 Registration and other fees ... 36,288 Territorial revenue 30,192 Tho principal decreases were : Interest on public moneys 657,075 Stamp and death duties 237,510 Departmental and oilier receipts 49,049 Land tax 115,040 Income tax 50,400 Post and telegraph 23,790 The decrease in intorest on public moneys is due to tho fact that the yearly interest duo to the Consolidated Fund on the amount advanced to tho Discharged Soldiers’ Settlement Account is outstanding. It is expected, however ; that the account will be able to meet its obligations for tho current year In view of the shortage of houses and the demand for homes by discharged soldiers, it was considered preferable to allow tho account the temporary use of the interest, amounting to £540.00C, for advances to soldiers, rather than to increase the public debt by further borrowing. To have borrowed for the purpose of paying this interest would have merely inflated the surplus and increased the annual charges of the public debt. The amount actually advanced to discharged soldiers for housing during 1923-24 was £571,000 for 714 homes. The revenue derived from the national endowments is now transferred direct from the Notional Endowment Account, instead of being passed through tho Ordinary Revenue Account, consequently a nominal decrease is shown in that respect With the exception of the death duties, tho other decreases are attributable to reduced taxation and charges. EXPENDITURE. The amount appropriated to meet the expenditure of the year was £27,483,373, but the expenditure was £26,148,005, which, when compared with the ‘ expenditure of the previous year, shows a not decrease of £115,755. Tho permanent charges on account of interest and sinking-tund payments including the Imperial funded debt contribution, have slightly decreased. The expenditure under special Acts is less by £505,347, but the provious year's expenditure included £250,000 paid to the Electric Supply Account under special enact-i inont. In the departmental expenditure the principal increases over the expenditure ©f the previous year were :

Railways 206,960 Public buildings Mines JO, 838 Naval defence ‘4,498 Defence “3,519 Valuation 56,609 Education °-',517 Services not provided for 123,74/ An amount of £70,000 for wheat purchased in Australia is included in the last item, but this will bo recouped. RESULT- OF YEAR'S OPERATIONS. £ Balance brought forward Ist April 1923 5,637,090 £ Revenue 27,960,370 Expenditure 26,148,005 Add surplus of revenuo over expenditure 1,312,365 7,449,455 Plus repayment by Native Land settlement Account (F inancc Act, 1923, sec. 7 (3) (transferred to Loans Redemption Account) 22,6 W 7,472,055 Less transfers to — £ Discharged Soldiers Depreciation Fund Account 50,000 Loans Redemption Account x 1,367,341 Public Works Fund 1,000,000 Education Loans Account Balance at 31st March, 1924 ... £4,954,714 The bulance was held us folows: Cash 1,727,746 Imprests 152,631 Investments 3,0/4,33/ £4,954,714 Included in the investments are debentures issued for State Advances purposes amounting to no less than £2,326,150. This satisfactory result justifies the opinion expressed in last year’s Financial Statement that the Dominion had reached the end of the period of unrest and uncertainty, and that natural causes, if supported by economical and carelul administration, would ensure a speedy recovery. Tho trade returns disclose steady progress arid prosperous conditions, and indicate that all this country produces can be sold or exchanged. For the financial year ended 31st March, 1924, the value of the exports exceeded the value of the imports by £7,250,009, there being an increase both in and value. After making due allowance for tho interest payable in the United Kingdom on Government and local bodies' loans, there remained a balance in favour of tho Dominion. It will, of course, be understood that any debit balance must ultimately be transferred to the permanent or semi-permanent debt; therefore, having regard to borrowing in the United Kingdom by the Government and local bodies, it is incumbent on me to point out that a credit balance can only be sustained by increased production. Borrowing abroad must therefore be kept within relative limits, and care taken that imported capital i 3 strictly applied to productive purposes. ACCUMULATED SURPLUSES. Bal. accumulated surpluses, April, 1923, £ amounted to 5,637,090 Less transferred, 1923-24, to — Discharged Soldiers Depreciation Fund £ Account 50,000 Public Works Fund 1,000,000 Loans Redemption Account 1,367,341 Education Loans Account 100,000 3,119,749 Add surplus of revenue over expenditure, 1923-24 ... ... 1,812,365 Add recoupment from Native Land Settlement Account of amount previously transferred to Loans Redemption Account 22,600 Balance forward on Ist April 2994 4,954,714 Balance made up of— Investments- 1 - £ - 2,326,150 B li of share: 375,000 Sundry securities .. 3/a,u» ■ ■ £4,954.714 public Works fund. The expenditure, on public works was

practically the same as that for the year 1922-23, amounting to £3,749,160, the bulk being for railway construction, additions to open lines, roads, etc., and telegraph extension. I propose to meet the requirements of the current year with £3,000,000 of tho loan recently raised in London, and to supplement this amount by again transferring tho sum of £1,000,000 from surplus revenue. ELECTRIC SUPPLY ACCOUNT. The expenditure undpr appropriation on development of hydro-electric schemes amounted to £812,975, as compared with the sum of £472,874 expended during the previous year, an , increase of £340,101. The principal works undertaken were development works in connection with the Alangahao scheme for providing Wellington, Wanganui and Hawke’s Bay districts with hydro-electric power; extensions at Horahora and Lake Coleridge, both of which schemes at present supply large areas with power. It is expected that current from Aiangahao will be available during the present year. DIPORTS AND EXPORTS. The values of imports and exports for the past six financial years are as under: Excess of

One of the chief factors has been the firm position of the wool market; while wool no longer holds first place t in our exports, it nevertheless is of such importance that fluctuations in wool values may make all the difference between a favourable or an adverse trade balance. LAND TAX.

Compared With 19Z2-23 land tax receipts decreased by £115,040, viz: 1922-23, £1»541,502; 1923-24, £1,426,462. This decrease represents a portion of the anticipated reduction in revenue following the removal of the super-tax, the balance being compensated for by the increased value of land in some of the districts revised under the provisions of tho Valuation of Land Act and the collection of a considerable amount of arrears of tax. INCOAIE TAX.

The income tax receipts compared with the vear 1922-23 shows a decrease of £50,400, ‘the figures for the respective years being :—l922-23, £3,331,932; 1923-24, £3,781,532. Tins decrease is due to the reduction of 20 per cent, made in the rates of tax. It was expected, .however, that tho decrease would have been much greater, but tho augmented incomes of taxpayers generally as a result of improved conditions furnished a compensating factor. ESTIMATES OF REVENUE, 1924-25. I estimate the revenue under the main headings of each of the principal departments atCustoms, £7,350,000; beer duty, £630,000; stamp and death duties £3,310,800- post and telegraph, £2,805,000; land tax’ £1,400,000; income tax, £3,700,000; railways £7,100,000; registration and other fees ’£200,000: marine. £90,920; interest on public moneys, £1,234,000; Local Bodies’ Loans Act, 1908, section 76, £23,000; rents on buildings, £26,000; tourist and health resorts £45,000; miscellaneous, £215,000; territorial, £197,900; departmental and other receipts, £530,000; total £28,857,620; less Dronosed taxation remissions, £1,000,000- £27,857,620. This would give the following, result:— Revenue £27,857,620 Expenditure £27,505,060

Leaving for supplementary estimates £352,560 which, in addition to normal requirements, must cover the increases in pay due to the regrading of .public employees’salaries.

Imports. Exports. Exports. £ £ £ 1913-19 19221923- .. 26,437,284 .. 32,162,029 .. 67,463,269 .. 35,986,060 .. 37,112,779 .. 44,401,755 32,263,792 50,776,650 48,219,672 43,794,883 45,548,700 51,652,606 5,826,508 18,614,621 19,243,597" 7,808,823 8,435,921 ~ 7,250,850 "Excess of imports.