Manawatu Evening Standard. MONDAY, MARCH 30, 1925. NEW ZEALAND'S FAVOURABLE POSITION.

Manawatu Standard, Volume XLV, Issue 101, 30 March 1925, Page 4

Manawatu Evening Standard. MONDAY, MARCH 30, 1925. NEW ZEALAND'S FAVOURABLE POSITION.

“Probably no country in the world” (says tli© London Times of February 10th, 1925, in its “Annual Financial and Commercial Review”) “has made such a speedy recovery from the aftermath of tho war as the Dominion of New Zealand, which has great natural assets, a genial climate, fertile soil, and an industrious and resourceful people, whose happy condition is largely attributable to the wisdom and prudence with which the finances were administered, both during the war und in the troublesome time which followed.” Early in 1921, the Times points out, “abnormal conditions prevailed and Mr Massey, the Prime Minister and Minister for Finance, faced the possibility of a large deficit. This was only avoided by the adoption of one or other of unpopular alternatives —either by increasing taxation or rigidly curtailing expenditure. The former alternative was unpractical because the community was seeking relief from heavy war taxation. The lutter policy was adopted. The great disturbance in the conditions of trade and commerce occasioned by the war made it difficult accurately to gauge the financial requirements, and it was not possible, even if it had been a good policy, to budget for a close balance between the revenue and the expenditure. Tho public finances were conducted on safe lines, with the result that the revenue surpluses amounted in 1920 approximately to seventeen and a-half millions sterling. Heavy importations, which proved an embarrassment to traders, greatly augmented the Customs duties. The surplus for that financial year was over six millions. At March 31st, 1924, the accumulated surplus totalled nearly twen-ty-seven millions, being practically equivalent to a full year’s revenue. During the period of reconstruction the accumulated revenue reserve proved a source of great financial strength. The money might have been applied directly to reducing the public debt, but as the money market was much disturbed and the interest rates were relatively high, the funds were used for capital purposes, such as financing the discharged soldiers’ settlement scheme and providing cash for carrying on general development and public works. A sum of £4,000,000, however, was used for redeeming the national debt and £3,000,000 was invested in State advances to settlers and other interest-earning securities. Borrowing to the extent of approximately £25,000,000 was obviated at a time when such a course would have proved very expensive. A sum of £2,000.000 of the surplus revenue is invested in gilt-edged securities in London as a reserve fund, kept intact as a safeguard against unforeseen events. Between 1914 and 1922 the expenditure of the Consolidated Fund was increased to a considerable extent, and it became clear that the country could not continue carrying the heavy burden entailed. Extensive economies were therefore instituted, which resulted in a total saving of nearly four millions. The amount derived from the laud and income tax had risen from £1,300,000 for 1913-14 to £10,000,000 for 1920-21.” Such are the opening passages in an illustrated page review of the resources and finances of New Zealand, which the Times describes in its headlines as “The Land of Great Opportunity,” giving “Evidence of Wonderful Prosperity,” the whole affording a magnificent advertisement of the Dominion and a great tribute to the wisdom displayed by its Government both during and since the war.

The Times notes with evident satisfaction that “the economies in expenditure made it possible to grant

much-needed relief to the taxpayers and that “the Minister of Finance inaugurated a policy of progressive reduction of taxation in 1921-22” ; that the super-tax on incomes was abolished, and that the land tax was substantially reduced; that these, with other minor concessions, were valued at close upon £1,000,000 in 1923, when further income-tax concessions were granted, while the tax on income from land under cultivation, and the supertax on land were abolished, the total remissions for this year being valued at £1,180,000, and that the year 1924 brought additional relief by way of reduction in the land aud income tax, amounting to over £700,000; while reductions in Customs duties, amusement and other taxes brought the total of the annual value of the taxation reductions to date to over £3,000,000. “New Zealand,” it is further pointed out, “also led the way in the re-estab-lishment of penny postage. This, with other reductions m postal charges, gave further relief estimated to be worth £600,000 per annum.” Condensed statements of the revenue and expenditure for the financial years ended March 31st, 1923, and 1924, follow, with the note that “the expenditure for the year (1923-24) continued to reflect the policy of economy, and the surplus of £1,800,000 affords additional evidence of the rapid recovery in trade and general prosperity.” The financial position, the Times considers, is sound, the figures __ for the eight months ended 30th November last showing that, compared with the same period lor 1923, the revenue had ■increased by £340,00U. Referring to the public debt, it is pointed out that “only about one-third is dead weight, and that was incurred for war purposes.” Practically the whole of the remainder is borrowed capital, which has been expended in building roads, railways and telegraphs, and opening up lands lor settlement; establishing hvdro-electric power and providing settlers with capital required to work and develop the land. The review proceeds on very exhaustive lines dealing with the productive capacity of the country, the war debt, the ordinary debt, the State advances, the financial help extended to soldiers and their settlement upon the land, the success of which comes in for warm commendation, and note is taken of the fact, in connection with the public debt, that the accrued sinking funds amounted to approximately £13,000,01)0 at 31st March, 1924, while testimony is borne to the high credit the Dominion enjoys on the London market, by references to last year’s loan issues amounting to £6,000,000, the money being obtained at 4} per cent., on terms which “compare more than favourably with those secured in other parts of the Empire. The loan (it is pointed out) was subscribed fourfold immediately and went to a small premium.” Note is also taken of the agricultural and pastoral operations, and of the greatly increased output of dairy produce, instructive tables being furnished of the development during the last ten years, both in the primary and secondary industries. With a population of 1,139,671 in 1914 the total trade of the Dominion was £45,783,085. In 1924 the population had increased to 1,347,754 and the total trade amounted to £93,654,362. The exports of wool, frozen meat, butter and cheese are also given for the two periods, showing more than a 100 per cent, increase; while the secondary industries have also made material progress, the number of employees engaged in industrial manufactures rising from 47,631 to 63,233, and the value of the products from £31.729,002 to £73,853,423. “These figures (the Times says) are a tribute to the productivity of New Zealand and are also an indication of the prosperity of the people.” New Zealand holds the unique distinction (the Times further states) of providing Great Britain with more dairy produce than any other country in the world ; more mutton and lamb, more crossbred wool and more tallow. “Of Britain’s total contributions of butter from overseas, one-quarter comes from New Zealand; of cheese, one-half; of her total wool, about one-quarter; of her tallow, onethird ; over 50 per cent, of the mutton and lamb which Britain receives from all countries of the world, comes from New Zealand.” Another interesting fact disclosed in the review is that the Dominion is the largest per capita purchaser of British goods. “Every New Zealander,” it says, “buys from Britain to the value of £l7 per annum. From the Empire as a whole she obtains 78 per cent, of her purchases.” There are further tributes to the undeveloped resources of the Dominion; to the development and extension of hydro-electric power, and to the opportunity the country offers for tourists and sportsmen, and, iu a final note, the Times says: “It is doubtful if in any other country in the world such great fertility and productiveness of soil and such wonderful endowments are to be found so closely confined—certainly not in any country of the same size.”