STATE FINANCE

Nelson Evening Mail, Volume 76, 7 August 1941, Page 2

STATE FINANCE

NATIONAL DEVELOPMENT LOAN ESTABLISHING NEW ACCOUNT | BILL INTRODUCED IN HOUSE i< From Our Parliamentary Reporter) Wellington, This Day. ) The National Development Loans ) Bill, a measure establishing a National Loans Account within the Public Account and authorising the Minister of Finance to raise money for national development purposes, as well as providing for a new accountancy procedure, was introducin the House of Representatives last night. The Bill was read a first time. Its provisions are to come into operation on Ist April. 1942. ; j In a brief explanation of the Bill, th< I Minister of Finance (Mr Nash) saic | that the measure placed national exj penditure in its correct perspective The Bill authorised the raising o

money for national development purposes and abolished the old Public Works Fund; it kept the Consolidated Fund in its present position, but provided that there should be one account only into which should be placed all the moneys that were borrowed. That was the National Development Loans Account, and out of it would flow to the various activities associated with the State all the moneys required by those particular activities. Mr Nash referred to a schedule at | the end of the Bill which set out the i following funds or accounts to which ! moneys might be transferred from the j National Development Loans Account during the first three months of the j year ending 31st March. 1943:—The | Public Works Fund (General Pur-j poses Account), the Electric Supply J Account, the Land for Settlement Ac-J count, Main Highways Account, the j State Coal Mines Account, the State A)rests Account, the Housing Account, and the Iron and Steel Industry Account. Mr Nash added that the new procedure would enable members to more comfortably and reasonably criticise j expenditure because it would all be linked up under one account. Under the new measure the Minister | j '); Finance is empowered to borrow on ! i the security of the public revenues of i I New Zealand, such sums as he thinks • 1 fit. but the total must not exceed the I amount authorised by the Appropria- I ! tion Act or other Acts passed in that j financial year. The Minister is empowered to prescribe the rate of in- : i terest paid. Full authority is given for j transfers from the National Develop-! | ment Loans Account to other accounts I in anticipation of Appropriation Acts. I f, u t the transfers must not exceed the j balance of the authorised amount not transferred during the previous year. ; together with a further amount equal ! to one-fourth of the authorised amount. 4 i The amount which may be transferred | during the first three months of the l financial year ending 31st March, 1943. i to the funds and accounts mentioned in the schedule must not exceed in the i aggregate £4.000,000, | if the Minister considers that supple. | mentary transfers from the Account are ! necessary, full authority is given for : these additional transfers to be made, • but they must not exceed 10 per cent. l of the appropriation. All transactions 1 u nder the Account have to be reported ; to Parliament. „; The loan moneys transferred under

lilt: lUtlll iiiiiiiy. 11 the Act, until they are repaid, are to j constitute a capital liability to the Con- t solidated Fund, and all moneys prev- , iously borrowed for the funds or ac- i counts and not repaid are also to be a liability on the Consolidated Fund. All ; other loans from the Consolidated j Fund which have not been repaid are to be similarly treated. Provision is made for different rates of interest to j be paid to the Consolidated Fund on ! loan moneys. The Minister is given authority to direct the repayment of capital liabil- | ity when he considers that any fund j or account has an excess that can be j applied for this purpose. Replying to a question by Mr W. J. j Poison (National, Stratford). Mr Nash said that the Public Works Department | would continue to administer the Pub- I flic Works Fund. There would be an j | Electric Supply Department, which j j would look after the Electric Supply j I Account, and the Iron and Steel Indus- ! i tries Account would be managed by j ! the Industries and Commerce Depart--1 ment. ! In answer again to Mr Poison, Mr ■ Nash said that, the new procedure of j borrowing for one account only would i result in a saving of interest.