EIGHT MILLIONS

Otago Daily Times, Issue 23352, 18 November 1937, Page 10

EIGHT MILLIONS

The inclusion in the Finance Bill, which the Government has introduced, of provision for the borrowing of £8,000,000 for public works purposes is the accompaniment of the announcement by the Minister of Public Works that the proposed expenditure of his department for the year out of loan moneys is £10,440,957. However concerned they may be about it, most people will be disposed to regard the borrowing 1 that is thus contemplated as the natural and necessary consequence of the Government’s adoption of a vast programme of railway building, road construction and other forms of public works. There must, however, be a good many supporters of the Government—some of them in Parliament —who will be seriously perturbed by the proposal to have recourse in the ordinary way to the money market in order that the expenditure on these undertakings may be met. They may recall that, before the responsibilities of office devolved upon him, the Prime Minister could not imagine “ anything madder ” than a system under which the Government created “ a debt in perpetuity—snowballlike, gathering as it grows.” They may also recall that the Labour Party possessed a policy, prior to the general election, by which it was going to avoid a repetition of the mistakes of the past that caused so much grief to Mr Savage. Its policy was to “ assume control of the public credit and establish a national credit authority, whose duty it will be to provide a money service sufficient to give effect to the will of Parliament.” It will doubtless be the will of Parliament that Mr Semple’s schemes of public works shall be prosecuted. And it might be expected in that case that the “ national credit authority,” which the Labour Party was to establish when it secured power, would “ provide the money service” by means-of which these schemes might be financed. The present proposal to furnish the funds by the common and “ mad ” course of borrowing extinguishes kny expectation of this nature. Evidently the Government has discovered that it must revise the beliefs that were expressed in the past by some of its more prominent members respecting the method by which it might obtain a “money service.” In the past financial year the public debt was increased by £5,109,102. It seems not improbable that it will be increased by a larger amount this year. Quite plainly, those simple people who imagined that there would be no considerable addition to the indebtedness of the country while a Labour Government was in power are doomed to disappointment.