FINANCIAL STATEMENT.

New Zealand Herald, Volume XXXIV, Issue 10411, 8 April 1897, Page 6

FINANCIAL STATEMENT.

SURPLUS OF £340,000. [BT lILEGKAFH.—PRESS ASSOCIATION.] Wellington, Wednesday, Is the House to-night the following Memorandum by the Hon. Colonial Treasurer, R. J. Seddon, showing approximately the position of the Public Accounts on March 31, was laid on the table with the leave of the House :—

The necessity for laying this memo, on the table of the House arises, as hon. members are aware, from the fact that it was deemed advisable to hold a special meeting of Parliament for the purpose of enabling arrangements to be made for the fitting representation of the colony at the celebration in honour of - the sixtieth anniversary of Her Most Gracious Majesty's reign. To get the accounts audited and passed is impracticable, for members will remember that according to to the existing law the treasury has thirty days allowed for the preparation and printing of the abstract of the revenue and expenditure of the year, and within this period the abstract has to be sent to the audit officers who havea further period of fourteen days allowed for the examination and passing of accounts. Hon. members may think this is a long period to be allowed when it is compared with the rapidity with which the public obtain somewhat similar information of the year's results of the Australian colonies; but a little reflection will show that the cases are dissimilar, inasmuch as they have in each colony only one or two centres, and more important still the information supplied has not been audited, while in our colony, with quite ten centres, we are obliged to wait until the accounts reach the Treasury from long distances, to be afterwards examined and passed by the audit officers before they can be finally included in the public accounts of the colony. With this explanation I will now proceed to give you a close approximate result of the past year's financial operations, which will be sufficiently accurate for all practical purposes.

THE SURPLUS.'

j Tho information which I know you i are all anxious to ascertain is as to the surplus, for there is a surplus, and a handsome one too. Well, 1 make this to be at least £340,000, arrived at thus :—Receipts for year, £4,796,000; expenditure of the year, £4,671,000 ; excess of receipts over expenditure, £125,000; add balance to begin the year with £215,500; surplus at end of the year £340,000. This is an exceedingly satisfactory result I am sure you will allow, and these figures would have been better still had it not been for the necessity to charge three half-yearly payments of the interest on Advances to Settlers' Loan of £1,500,000 during the past year so as to bring the accounts in line with the dates upon which the interest is paid over to the Bank of England in London. This extra half-year's interest having to be met has decroased the surplus by £22,500. The Advances to Settlers' is doing well, for notwithstanding it has had to pay £67,500 within the year, it has only required an advance from the Consolidated fund to the extent of £26,000 for this current year, and hereafter of course only £45,000 per annum will require' to be paid for interest on the £1,500,000 loan, and there is a certainty that the office will soon be able to provide for each year's charge, and to pay off the arrears of debt due to tho consolidated fund.

RECEIPTS AND EXPENDITURE. I do not propose to weary you with a mass of figures connected with the results of last year's Treasury work, I hove already reminded you that such figures as I shall be ablo to place before you must nob be considered final, but only approximate, and therefore I am sure you will excuse me if I confine myself to the main features of-our receipts and expenditure. The receipts for the 'financial year 1896-97 were estimated at £4,484,000, while the actual receipts so far as I can at present learn have reached £4,796,000. Customs revenue exceeded the estimate by £148,500, railways by £80,000, stamps by £38,500, land and income tax by £17,500, territorial by £5500, and the remaining heads of revenue and receipts .by £16,000. These toll their own tale, and it is quite superfluous to observe that they evidence a substantial increase in the material prosperity of our colony. The approximate results of revenue can be ascertained with a considerable degree of certainty, but it is more difficult to furnish an estimate of the actual expenditure. It has to be remembered that on the Close of business on the 3lst March last over £230,000 of imprest moneys were outstanding against the ordinary revenue account of the cousolidated fund. This amount is reduced by the departments dealing with the imprestees' vouchers, and charging the votes with the respective amounts paid, and also by the cash repayments by the imprestees of their respective balances on the 31st ult. If on the other hand we estimate the expenditure out of imprests at too large a figure we unduly reduce the surplus, whilo on the other hand if our estimate is too little the surplus is proportionately increased. The Treasury and the departments concerned have, however, made very careful estimates, and I am able to submit the results with every confidence. The figures, however, must net be accepted as final, but the alterations are nob likely to be large. I estimate our permanent expenditure, including interest and sinking fund subsidies, payments to local bodies of endowment moneys, pensions, etc., at £2,076,000. My estimate for the year was £2,093,000. For the annual appropriations members were good enough to vote £2,438,000. I do not anticipate, however, that the final expenditure will reach more than £2,420,000. Under the two heads, therefore, a saving of some £35,000 may be expected. Economy has been rigidly practised by the departments, but members, I am sure, do not expect large savings to be effected, as it would bear the appearance of having asked the committee for sums in excess of what was really required. To this expenditure there was also to be added £150,000, transferred to the public works fund out of the previous year's surplus, and also £26,000 advanced to the Advances to Settlers Office.

PDBLIO WORKS FOND. I do not propose, on this occasion, to submit what I call the minor accounts connected with the consolidated fund, such as the "accounts of local bodies," "deposits," etc., but I shall at once pass on to the more important accounts and take up the state of the Public Works fund. Part 1 of this fund commenced the year with a balance of £31,150, and also received £150,000 from the Consolidated Fund Surplus of the previous year. Other miscellaneous receipts swelled the available balance to £196,413. During the year we were able to raise £750,000 of the £1,000,000 authorised under the Aid to Public Works and Land Settlement Act, 1896, and of this £375,000 was credited to Part 1,, making the total receipts, including the balance brought forward, £571,413. The expenditure after the imprests have been duly accounted for, I estimate at £420,655, leaving a balance of £150,758. £250,000 has still to be raised under the Act I have just mentioned, so there will be further funds available for this account to the amount of £125,000, which with the amount in hand, and the usual assistance from the consolidated fund, should be amply sufficient for our requirements during the current year. Part 11. had a balance of £13,900 to begin the year with. Expenditure will be charged so as to clear off this balance. This account is now practically merged in Part 1., where further appropriations for the North Island Main Trunk Railway have been provided. " The lands improvement" and " the native lands purchase " accounts have also been placed in the fund to the amount of £187,500 each through the raising of the three-quarters of a million under the Aid to Public Works and Land Settlement Act, 1896, and with the proceeds of debentures amounting to £52,000, raised under the Act of 1894. The estimated expenditure of the lands improvement account is set down at £109,000, leaving a balance of. £134,500 to go on with. In the native lands purchase account, the expenditure is estimated at £127,000, leaving a balance of £97,200 to provide for purchases during the current year. As I have before' mentioned, \ there is still a balanceof aquarter of a million to be raised under The Aid to Public Works'' and Land Settlement Act, 1896, and ; when the proceeds have been received, the lands improvement account, and.the native lands , '■'■"■ '.'';";':.' ", .-■;■:■•■■ .. >

purchase aecounb will each be entitled to be credited with £62,500 of the £250,000 to be raised. With these sums available lam satisfied that the works in progress to improve and open up the reading of the country will be steadily continued, and further, lands can be acquired from the natives, and oar arrangements in this direction successfully carried out.

PURCIIASfc OF ESTATES. Some large estates hare been purchased under the Land for Settlements Act, 1891, for which purpose £297,300 has been raised during the past year, and this amount, with some £20,000 derived from rents, has been sufficient to provide for an expenditure of £312,500, leaving a balance in hand of £6000,

BALANCES. I shall presently deal very briefly with the operation within the public debt and con' version accounts, but at this point I think ib may be convenient to recapitulate some of the balances. The surplus of the consolidated fund amounted to £340,000, of which I hope to be able to aid the public works expenditure to the amount of £200,000, leaving £140,000. Of this balance of £140,0001 think it would be expedient to set aside £50,000 for the purpose of assisting the requirements of the Land Improvement and Native Lands Purchase accounts, in case the available balances of these accounts should nob prove sufficient for the expenditure which it may be found absolutely necessary to incur. With this extra assistance it is quite certain that 1 shall have plenty of funds to carry on the Public Works services of the colony, and for the acquisition of native lands for the current financial year. The balance of the Public Worts Fund was £150,000, the proportion of balance of loan, £125,000; aid from consolidated, £200,000; total available balance for current year, £475,000. The balance of the lands improvement account was £134,500; proportion of balance of loan, £62,500; aid from consolidated fund, say, £25,000; total available balance for current year, £222,000. The balance of the native lands purchase account was £97,000; proportion of balance of loan, £62,500; aid from consolidated fund, say, £25,000: total available balance for current year, £184,500. These balances will sufficiently prove that our resources for the current year in respect of our loan accounts are ample, and will cover all possible requirements. The operations within the " conversion account" last year were small, and the table speaks for itself,

lam able to place before you the usual table of the public debt. The gross total has increased by £1,315,838, and the neb debt by £1,280,682. Of this sum, howevor, one million ii absolutely represented by equivalent assets, and the interest thereon is paid back to the {Treasury |by those who have obtained the benefit of the expenditure. Of the million authorised by the Aid to Public Works and Land Settlement Act, 1896, £730,000 has been raised. Deposits amounting to £136,015 under the New Zealand Consols Act, 1864, have been received, £93,800 of debentures under the Government Loans to Local Bodies Act, 1886, have been issued. Purchases under the Land for Settlement Act, 1894, have required the issue of £297,300 of debentures, and for the purpose of opening roads and giving aocess to lands £52,000 ot debentures under the Lands Improvement and Native Lands Acquisition Act, 1864, have been sold. £70,300 was issued as sinking fund debentures under the Consolidated Stock Act, 1884, but of this amount only £20,000 was issued against the accretion of sinking fund of the loans to local bodies,'and £56,891 of stock was inscribed at 3 and 3£ per cent, for the purpose of conversion and redemption of other Government securities. On the other band we have paid off or reduced various parcels of debenture stock amounting to £87,068, and have converted £53,100 of debentures into lower interest beariug inscribed stock.

EXPECTATIONS FOB THE RECESS. Of course you will expect me say something about the financial expectations during the time between 31st March last past and the time when further supplies will be granted. In the first place I shall ask you to extend the appropriations from three months (as provided for by the Public Revenues Act of last session) to twentyeight weeks, or say to the 14th October next. The Public Revenues Act provides that no paymonts shall be made for any services than those for which provision was made in the respective appropriation acts and estimates of the preceding year, or in excess of the scale therein set forth. You therefore tie me flown in a narrower compass than would be the case if I were to ask you merely for supply under the Imprest Supply Bills. Some effect of this restrictive appropriation is to drain the £100,000 provided for unauthorised expenditure, and it happens frequently so. The Treasury officials inform me that the limit of £100,000 is practically exhausted by the time that Parliament usually meets, and Imprest Supply Bills are obtained. Under these circumstances I am going to ask you for a temporary increase for " unauthorised" expenditure, so that the limit of £100,000 may be raised to £150,000 for services not provided for between this and the 14th October next. You understand that all " unauthorised" expenditure incurred before the Estimates are passed has to be included in the estimates and appropriations of the year, and of course the whole of the expenditure made under the extended appropriation. Last year's appropriation for consolidated fund services amounted to £1,458,000, one-half of which for services required to the 30th September next will amount to £1,219,000. Add to this a moiety of the permanent charges £1,047,000 additional estimated expenditure for. 28 weeks £175,000, making it a total for the 28 weeks of £2,441,000 required for expenditure. Our receipts during last year produced, as I have stated, approximately £4,796,000, bat of this amount £377,000 for land and income tax was received, and will again be received during the second half of the year, so that this amount will not be available until after October. The lull in mining business in the Auckland Provincial District may affect the receipts from customs and stamps, and unhappily the accounts of the grain crops from the Canterbury and North Otago districts justify me in thinking that our railway revenue may also suffer; but let it be understood that I am by no means depreciating the probabilities of our income, but, as I thoroughly believe in strong finance, I think it best to place the position candidly before you. Our resources may be stated thus:—Receipts for past year, £4,796,000, deduct land and income tax £377,500, deduct sinking fund debentures £70,300, total £447,800, leaving £4,348,200. A moiety of £4,348,200 is say £2,174,000. To this may be added the unappropriated balance of the surplus £90,000, sinking fund debentures to be issued £73,000, additional estimated receipts for two weeks £167,000, making a total of estimated receipts £2,504,000 estimated expenditure (as above) £2,441,000 leaving an excess of receipts of £63,000. I have put these figures before you so as to show you, that there is no uncertainty: as to the finances being simply sufficient to meet (he requirements until Parliament is again in session. ■ I must at the same time state that the first half of the year is very much the worst half, so far as the revenue is concerned. On the other hand the expenditure is scarcely likely to reach the figures quoted. Members will notice that 1 have included a sum of £73,000 for sinking fund debentures to be' issued during this current year, but I am carefully considering, whether the time has nob arrived as the finances of the colony appear to be able to bear it, to dispense altogether with the issue of debentures against the accretions of sinking fund derived from the loans to local bodies. Probably next session I shall ask you to have the law amended in this direction, I hope that in placing before the House this memorandum and accompanying tables honourable members will recognise the difficulties ' there ' are in the way of giving the necessary information in a more compact form. ,1 trust, however, that I have sufficiently demonstrated that there is no cause whatever for any anxiety in respect to the financial position of the colony.' i: - v '< >•/.>/. *-&•■. >y '- ■■