PUBLIC WORKS

Otago Daily Times, Issue 24336, 28 June 1940, Page 9

PUBLIC WORKS

PROGRAMME FOR YEAR EXPENDITURE STILL HIGH A TAPERING-OFF PROCESS The allocations for public works, Mr Nash said, make up a grand total of £20,589,000, but, as revenue from hydro-electricity, highi ways, etc., is estimated to provide a total of £5,506,000 the loan requirements for the year are reduced to a net total of £15,083,000. Approximately half of the total allocation concerns the activities of the Public Works Department, the balance being under the control of the Railways. Lands, Housing Construction and other departments. This loan programme ol £15,085,000 is. of course, additional to the amount that will have to be borrowed for the War Expenses Account. Mr Nash continued. but national works cannot be dissociated from the war effort Much of the expenditure is necessary to support that effort or to pave the way for the rehabilitation phase that must follow the war Development Work In addition to meeting all war requirements, Mr Nash said, some provision has to be made for carrying on national works such as the development of more hydro-electric power required for our industries, both primary and secondary and land development and irrigation works, which have a direct bearing on increasing production. while the curtailment of road transport to conserve petrol makes it «all the more important that sufficient rolling stock is provided for the railways to handle the traffic. In fact, useful development work is a necessary preparation for rehabilitation which must start before hostilities cease. ~ Even so, it ; s fully recognised by the Government that with so much required for war purposes, borrowing for public works must be reduced to the minimum required for essential works. It will be appreciated that it takes time under the proposals for marshalling the man-power of the Dominion to get large numbers of men transferred from public works to other works of greater national importance. Furthermore, the large volume of works in hand has either to be completed or rounded off at a point where it can stand over without losing the money already invested. A substantial beginning has been made in reducing the expenditure on the whole works programme, and the amount of borrowed capital required this year is approximately £15,000*000, compared with ' £19,000,000 for last financial year. As men are required for more urgent purposes associated with the war the volume of national works will be progressively reduced. Concerning the actual works which it is proposed to carry out during the year, an allocation of £3,450,000 has been made to railways construction and improvement. Of this total, £700,000 will be devoted to the completion of construction works already in hand, including the Napier to Gisborne and South Island trunk lines. The new line from Paeroa to Pokeno, which had just been commenced at the outbreak of war, has been discontinued for the time being. The balance of £2,750.000 under this class is for additions and improvements necessary for meeting existing com-, mitments and to building essential locomotives, cars and wagons, new goods sheds, etc. From a military point of view alone, an efficient and complete railway organisation is most important in the national interests. Hydro-electric Undertakings The expansion of industry, both primary and secondary, has necessitated a substantial increase in hydroelectric capacity for which an allocation of £2,750,000 has been made. This includes new works on the Waikato River and near Lake Waikaremoana and in the South Island, .11 urgently required to provide for the demands of consumers. The Cobb River scheme in the Nelson district has been acquired from the company which commenced its construction, but the price is being paid in long-term securities. The supply of electricity continues .o be a successful State enterprise, and the gross revenue for this year is expected to exceed £2,000,000, which will pay all working expenses, including depreciation, and provide a substantial residue towards the extension of works. Under the heading of “ land development and afforestation,” for which provision of £3,234,000 has been made, die policy is to concentrate more especially on those phases of development which will result in immediate and material increase,- in production. Under this heading is included irrigation (£425,000), -md clearing and improvement (£350,000), small farms development (£550,000), and Native land settlement (£1,000,000). These facilities, too, will be of advantage in connection with a comprehensive scheme for the rehabilitation of the men in our forces, which the Government has now under consideration, as it is necessary to provide for such requirements well in advance. A very large extension of linen flax growing in the Dominion, on an economic basis, is being planned. The immediate object is to meet war requirements, but this extension opens n additional avenue of primary production. Housing Construction The public demand for adequate housing facilities still continues, and provision for the expenditure of £4,000,000 has been made during this financial year. The Government regards this as one of the most important and successful of its activities, as, apart from providing a better environment, the building industry is a key industry in the maintenance' of a balanced national economy. \nother important factoi is that houses are in short supply now. and any curtailment of construction during the war would result in serious difficulties when the men return home from overseas. The roads and highways allocation for this year has been reduced to £4,J50,000 Expenditure under this heading is being restricted to the completion of works in hand and to metalling work in the more remote areas where such works can be shown to.be necessary. Petrol tax and the other forms of highways revenue, of course, provide for the maintenance of our main highways, any residue being utilised tor construction and improvement works. The balance of this year’s allocation for public works is in respect of public buildings, including schools and telegraph and telephone extension, and other miscellaneous services, for which works a total of £2,805,000 is provided All these activities have been curtailed and are now confined to finishing ork in hand or undertaking jobs that are essential

LOAN EXPENDITURE OUTLINE OF NEEDS j INTEREST-FREE SYSTEM NATIONAL SAVINGS SCHEME The Minister said that if by all the means outlined a total of £14,130,000 is obtained from taxation for war expenses it will be necessary to borrow £3,630,000 for expenditure in New Zealand and £19,750,000 for expenditure overseas. For the latter, he said, we can rely upon the arrangement made with the British Government, but should not do so more than we can possibly help Thus everyone can play an important part in the Dominion’s war effort, he added, by curtailing his consumption of goods, avoiding waste, and saying every penny and investing it. as it were, in national security. In addition to loans in a form suitable for ordinary investors, provision will be made to enable the rank and file of the people to do their part by, subscribing small amounts at regular or irregular intervals as best suits them. This will be dene through the introduction of a national savings scheme operated in conjunction with the Post Office Savings Bank. Each individual’s contribution will be accmulated in a separate national investment account in his or her name, and if desired. will be convertible into national savings bonds. Provision for loan contribution by large investors will be made by the issue of loans with a currency of 10 years or more in respect of which Government stock will be issued in the usual manner. In the circumstances the Government considers that these loans should be regarded as contributions to the war effort from the material assets of those with property and should accordingly be free of interest for a period of three years or until 12 months after the conclusion of the war, and thereafter for 10 years at a rate of interest not exceeding 2J per cent In this way the Government proposes to raise within New Zealand not only the money required to be expended in this country, but also some portion of the amount necessary to • meet expenditure abroad, thus relieving, so far as is possible, the drain upon the resources of the British Government. A start towards the provision of in-terest-free loans has already been made by generous voluntary effort on ’the part of many citizens, and to date nearly sufficient has been subscribed to balance the War Expenses Account to the end of last financial year. But that is not sufficient. It is not right that others equally capable of affording assistance should not make their due contribution. In this connection It is the interttion of the Government to formulate for the consideration, of the House a procedure under which all who have means will be required to assist by subscribing to loans for these purposes. These who already have or who may in the future voluntarily lend money free of interest may have the amount already subscribed taken into account in determining their total liability under this heading.