Manawatu Daily Times New Zealand's National Debt

Manawatu Times, Volume LIV, Issue 6808, 11 January 1929, Page 6

Manawatu Daily Times New Zealand's National Debt

■\7ALUABLE information concerning many things is given in V the New Zealand Year Book, the 1929 volume of which is iust to hand. Of particular interest just now is the section devoted to the Dominion’s national debt in view of the flotation of new loans and the redemption of old ones. The gross debt of New Zealand has grown from £27,000,000 or £52 per head m 1880 to over £251,000,0000, or nearly £173 per head at the close of the last financial year.

The history of the public debt of New Zealand, the Statistician says, may conveniently and with advantage bo divided into four periods. The first covers the years prior to 1891, when loan expenditure was chiefly concerned with roads and’ railways, the liabilities taken over from the provincial Governments and the Maori War. Then comes the period up to 1914, when the functions of the State were widely extended mostlv as regards financial assistance to settlci’s, workers and local bodies, the repurchase of alienated lands, the working of coal mines, the development of hydro-electric power and the establishment of the State fire and accident insurance offices. The remark is made that in every department these new activities, as well as the old, have been directly successful, while the indirect benefits are incapable of measurement. In this period the increase of the debt, which stood at £38,830,350 in 1891, was £55,923,477.

TShe third period is that of the war jeais fiom Uln-lo to 1519-20, when expenditure of an unproductive nature occasioned by the war may be fairly regarded as having ceased. Although in the years immediately following the financial year 1919-20, considerable sums were provided by loans for purposes directly arising out oi' the war, the bulk of this money was expended in undertakings of the nature of investments, and it is contended that it should not be regarded as partaking of the nature of unproductive war expenditure. In the six years mentioned, the debt increased from £94,753,827 to £201,170,755, the war accounting directly for £80,089,025 of the increase.

In the fourth period up to March 31, 1928, the debt grew by £50,225,497 to £251,396,252. Last May £5,000,000 were raised in London for public works, hydro-electric power schemes, 1 and for railway improvements, and the present Government is now on the markerfor a further £7,000,000 of new money for various purposes.

Of the debt of £251,396,252 existing at March 31 last, £72,505,515, or 28.84 per cent., was invested in productive works such as railways, telegraphs and telephones and hydro-electric power schemes; £25,012,055, or. 9.95 per cent., had been devoted to land settlement and forests; £36,884,434, or 14.67 per cent., to investments through the State Advances Office and in advances to various industries, etc.; and £23,413,350, or 9.32 per cent., into indirectly„ productive works such as highways, roads and bridges, irrigation, land and river improvement and immigration. The remaining £93,576,898, or 37.22 per cent., was financially unproductive. The then war debt of £71,970,636 accounted for the greater part of this sum, public buildings, including schools, being responsible for £12,499,818.

Against the debt New Zealand has assets totalling £262,542,305, and this, in spite of the fact that over £80,000,000 of the liabilities have been incurred for purposes which not only were unproductive, but were not represented by assets of any kind.