THE OTAGO DAILY TIMES FRIDAY, JANUARY 6, 1922. THE NEED FOR ECONOMY.

Otago Daily Times, Issue 18446, 6 January 1922, Page 4

THE OTAGO DAILY TIMES FRIDAY, JANUARY 6, 1922. THE NEED FOR ECONOMY.

The New Zealand Herald, in its first article of the year, suggests that economy and development should be the political slogan for 1922. Public economy, it says, has scarcely yet begun, and in this circumstance, it holds, tho weakest point in our national organisation is to be found/ Oun Contemporary ;b in issue with Ministers, as we are ourselves, in respect of this matter. Mr Downie Stewart has assured us not only that the intentions of the Government ate strictly honourable/ but also that the most rigorous economy is being enforced. We can Only say with regard to this that the public accounts furnish the only test by which the community can measure the extent to' which economies are being effected. They should furnish an adequate test. Judged by that test, the Government is very successfully concealing its performances in the enfofeeihent of rigorous economy. We recognise fully that, as Mr Downie Stewart claims, a reasonable, time must v be allowed before the Treasury is called upon to show the result of ito economies. It may be that our views differ from those of the Government as te what constitutes a reasonable time. More than a twelvemonth ago it was apparent that there Was a distinct need for exercise of both public and private economy. Taxation was pressing heavily upon the community. Tho prices of important products of the dominion had declined materially. However* much the revenue of the country might he maintained in the current year, it wa«| obvious that there would be a very serious shrinkage in the following year" in the yield from direct taxation, which has become by far the most fruitful source of public revenue. Anyone who appreciated this must have seen that it was even then desirable to set about the reduction of departmental expenditure. Prior to this, indeed, the Minister of Finance had offi-. cially expressed himself in sympathywith the plea for reduction. “Economy, without parsimony, is essential,” he said in the Budget which was brought down in July, 1920. “Anything approaching waste or extravagance must be eliminated from all State activities, so that full value may be ensured to' the taxpayer ip return for his expenditure.” In the financial year, however, which ended on March 31 last, the departmental expenditure exceeded that of the preceding year by £3,441,542. -If it was not reasonable to expect the Treasury to show the -result of its economies in the past financial year, it should not be altogether un* reasonable to suppose that these economies, which are, we are told, to represent a saving of between three and four millions per annum, should he revealed in some degree during 1 the current year. The accounts for eight months of the year have been presented, however, and they/ show that v the departmental expenditure is increasing, and that, for the eight months, it was £1,602,494 in excess of that for the corresponding period of the preceding year. Moreover, this increase in expenditure has been accompanied by a redaction of £2,463,499 in revenue. We give every weight to the argument that the expenditure for the current year is being swollen hy the heavy payments for imported coal, which constitutes an asset, and by tho payment of cost-of-living bonuses. But the expenditure on these items does not account for a balance of £4,874,504 oil the wrong side in eight months’ operations. It will not disabuse the public mind of tho impression that extravagance and waste are rampant in the State service, Nor does it “get over the fact that the public revenue is falling. This is a most significant fact. It indicates that the public cannot afford' to maintain services at the cost which it has recently been required to pay for thejn. All the financial barometers, from the railway returns down to the totalisator investments, convey the same warning. It is a warning against timidity and procrastination in the practice of public economy.