COST OF GOVERNMENT

Manawatu Standard, Volume LII, Issue 307, 25 November 1932, Page 9

COST OF GOVERNMENT

EXPENDITURE IN DOMINION. “1 suggest that to-day there is no important country in the world which has a more satisfactory net export income per head, than New Zealand,” stated Air W. Machin, of Christchurch, in an address delivered yesterday to the Chamber of Commerce at Oamaru. “Poor as ive think ourselves, we have this last year had an export income of £25,600,000 after meeting our overseas debt charges. We have still been able to spend oyer £ls per head of this overesas on imports, and then have a surplus. Twenty-five millions of external money income in our own currency for 1,500,000 of population! This should prove a sufficiently strong mainspring to keep the wheels of our economic life turning if its power could be evenly applied. “Unfortunately, fixed charges are rigid in their demands on this available power. The cost of Government is aotually greater to-day than it was in 1929 when our export income was over £20,000,000 more. Compare the expenditure of the Consolidated Fund for 1929-30, £22,473,590; 1930-31, £23,605,494; 1931-32, £22,966,848. Since 1923 a separate expenditure account has been kept for the Highways Board and this has grown from £llOO to £l,506,194 in 1931. The Unemployment Fund was also separated from the Consolidated Fund in 1931, when it was _Oi9,(X)O, and this is expected to be nearly £4,000,000 this year. “Compare also local body total expenditure for the last three years:— 1929, £22,423,167; 1930, £21,300,024; 1931, £22,061,088; and local body debt for a period of ten years: 1921, £26,000,000; 1926, £52,000,000; 1931, £64,000,000;' and it is now over £70,000,000. The necessity for Government revenue is one of the main factors responsible for import prices being reduced by only 4 per cent, last year. Rates and land tax also help to maintain wholesale and retail prices. “Wo shall not be efficient until we resolutely determine what proportion of our income we can afford to have earmarked for national and local government taxation and expenditure, so as to leave sufficient to flow into the arteries of industry and trade to keep them vigorous. In 1928-29 our nntional income was estimated at £150,000,000 and the State and local bodies took £24,000,000, or 16 per cent. In 1931-32 the amount required by local and State government was 26 per cent, of a much smaller income. I suggest that, if we limited the cost of Government in any. year to 12i per cent, of the national income for the previous year, we could still be well-governed. We have the highest debt per head of any country in the world. Much of that debt is lost capital, and much is permanently unproductive; the charges on it all add to the burdens of industry.”