FALLING REVENUE

New Zealand Herald, Volume LXXVI, Issue 23259, 31 January 1939, Page 5

FALLING REVENUE

EXCESS OF EXPENDITURE NEW SOUTH WALES BUDGET BALANCE MAY NOT BE REACHED The revenue of New* Smith Wales in tho six months ended December 31, 10,'58 —the first half of the financial year 1!W8-:S9—was less by £'-126.152 than that in the corresponding period of last financial year. Expenditure was £1.970,229 greater. Tho excess of expenditure over revenue in the period was £o.oß;uai).

The State Treasurer, Mr. J. Mair, said that, although these figures did not adequately convey the prospects for the full financial year, conditions had changed considerably since the Budget was introduced, and indications were that the Budget balance might not now bo achieved by June 30. Hie Premier, Mr. 13. S. Stevens, in his Budget speech . last September, estimated that there would be a surplus of approximately £BOOO in 1938-39. ihe surplus in 1937-38 was £54,000. "The position is similar to that in certain other States," Mr. Mair said. "It may call for some special financial arrangements and will require careful management, but there is ground for tho belief that much of the leeway will be overtaken in the next six months.

"While business and industrial expansion appears to have eased temporarily,'the gains of the last six years are being well held. The impact of the Federal expenditure on defence must lie beneficial to the revenues of the State, although it is difficult to see how far this will prove to bo an adjusting factor. The important thing for the State Government is to see that economic activity is maintained with employment at a high level." .Mr. Mair stated that a considerable disparity between revenue and expenditure was usual in the first half of the financial year, because most of the income tax" and other forms of revenue was collected between December and June. . „ , The prospects for the full year s Budget could be arrived at only by a comparison of the income received and the moneys expended with the estimates of revenue and expenditure as approved by Parliament for the current financial year itself. Examination of the detailed figures showed that the dispute in the coal trade caused the railways-a direct loss of some £300,000 in revenue, apart from the indirect losses to railways and other Government activities of probably £200.000. Again, the serious drought over a considerable part of the State caused a falling off of £200,000 in the amount of land revenues collected and diminished the revenue from rail freights. BRITAIN'S HUGE DEFICIT £249,446,766 TO END OF YEAR While providing no- accurate guide to the final position of the nations finances, Great Britain's revenue returns for the third quarter of the financial year show further big rises in income and expenditure. For the nine months ended December Jil total ordinary revenue at £190,435,566 com- | pares with £478,612,358 a.t tho end of I 1937. This rise of £11,823,208. boivever, is ! small when compared with the jump j of £91,826,941 to £298.542,332 in the 1 ordinary expenditure. These figures rej veal that the deficit so far amounts to ! £249,416.766. At December 31, 1937, ! the comparable total was £172,603,033. To reach the estimated revenue of £944.650,000 for the full year, there will have to be collected £454,214,434, or only about £36.000.000 less than has been received in the past nine months. Although not bright, the outlook is not as gloomy as some people had expected, since the last quarter is the most productive of income tax and other revenues, which always benefit from the Christmas trading. GOLD PRODUCTION WEST AUSTRALIAN FIELDS BEST YIELD SINCE 1915 With the average price of gold for 1938 higher than at any period in its history, the gold mining industry in Western Australia last year experienced another 12 months of prosperity. The yield at 1,167,792 fine ounces, valued at £10,364,023, was the best since 1915, when the yield was 1,210,112 fine ounces. Since 1915 the price of the metal has more than doubled, and the value of last year's yield constituted a record. The State's output has been more than trebled since 1929. In nearly all cases ore reserves of the major operating j companies have expanded, prolonging the life of the mines many years beyond the existing capacity of the mills. Approximately £1,114,000 in dividends was returned to investors by undertakings in the State, making more than £6.000.000 in the past eight years. Several of the more successful larger companies, by the installation of higher capacity plant and experiments in ore treatment, were able to reduce costs. An encouraging feature was the greater activity in the low-grade leases, where, with renewed vigour and modern efficiency treatment methods, a great measure of success has been achieved, in other instances some companies have transferred their development activities to more payable areas. Valuable financial assistance was again granted to the industry by the Government under the States' mining legislation. BRITAIN'S WELFARE ECONOMIC STABILITY STEADY IMPROVEMENT SHOWN Tho steady improvement, in the level of general prosperity in Great Britain is apparent not merely from the increased earnings of commercial firms, but also from many other aspects of production and consumption, states a review issued by the British Trade Commissioner in Wellington. It is stated that the output of British motor vehicles has increased by 13 per cent in recent months, and between September and October car sales increased over 17 per cent. Perhaps the most significant of general production figures, however, are those relating to the output of gas in the British Isles, They show an increase of 4.674,000,000 cubic feet for the last ]2 months, and the increase since the Great War is over 53 per cent. Industry is taking more gas, and this points to greater activity in trado of all kinds.

As a general index of economic wellbeing in Great Britain, it is customary to accept the figures for the output of beer. The latest statistics show that the October beer production in the United Kingdom was the best for that month since 19'K), and the 10 months' total, from January to October, shows a rise of more than 2 per cent over the output iu the corresponding period of last year.