STATE EXPENDITURE

Otago Daily Times, Issue 23883, 10 August 1939, Page 8

STATE EXPENDITURE

UNAUTHORISED PAYMENTS VALIDATING LEGISLATION THE PRINCIPLE DEPRECATED (From Our Parliamentary Reporter) WELLINGTON, Aug. 9. Cases in which the Audit Office has agreed to pass expenditure on the understanding that validating legislation is to follow are referred to in the annual report of the Controller and Auditor-general (Mr J. H. Fowler), which was presented to Parliament to-day. Although Mr Fowler reports that there were no cases in which the Government failed to honour undertakings of this kind, he states that there are inherent dangers in the practice. "In my last report," he states, " I drew attention to a number of instances where expenditure had been incurred for which no specific authority existed, but which, in order not to embarrass the Government unduly, the Audit Office agreed to pass on receiving from the Prime Minister his assurance that validating legislation would be introduced at an early date." Instances Detailed Detailing the instances in which undertakings to validate expenditure were required, Mr Fowler stated that a grant of £ 140 was paid by the Government to Mr J Hodgens, the member for Palmerston North, when he went to Australia to engage tradesmen for the building trade. As this contravened the provisions of the Electoral Act. the Audit Office was unable to pass the expenditure without an undertaking that subsequent validating legislation would be introduced. "In July, 1938," the report adds, "a retrospective increase was made in the price of cheese manufactured and exported after July 31. 1937, and in order to assure an equivalent net return to all cheese-makers, the Minister of Marketing later approved of an equalising payment of .21 of a penny a pound being made in respect of cheese manufactured after July 31, 1937, but not exported. It was pointed out by the Audit Office that the Primary Products Marketing Act applied only to cases where the Marketing Department had acquired dairy produce or had fixed the prices or conditions of purchase and- sale, and as the department had not fixed the prices or conditions governing the purchase and sale of cheese which was not exported, there was no authority for additional payments on cheese not acquired by the department. The Audit agreed, however, to pass the expenditure involved on the assurance of the Minister that validating legislation would be introduced." The Auditor-general states that there were no cases this year in which the Governmc t omitted to introduce validating legislation where it was required, but he regretted to report that legislation had not been introduced to provide the requisite authority for the Post and Telegraph Department legally o control the creation and issue of revenue stamps to which reference had been made in the last three reports. Unauthorised Expenditure Attention was drawn by the Auditor-general to what he described as an abnormal increase in the total surplus credits-in-aid during the year. These amounted to £1,602,572, and this tarn, together with the unauthorised expenditure, made a total of £2,727,042 that had been expended without the prior approval of Parliament. It was recognised, of course, that Parliament was unable to forsee and provide for every item of expenditure and the Public Revenues Act enabled a limited amount of necessary urgent expenditure to be made and later approved by Parliament; but it would appear from last year's total that consideration should be given to a revision of the existing authority regarding the use of surplus credits-in-aid. The report repeats the annual commentary on the unsatisfactory method which has been followed in the treatment of exchange in the Public Accounts, and states that this reference has appeared in every report since 1932.