FINANCIAL STATEMENT.

Otago Witness, Issue 3672, 29 July 1924, Page 6

FINANCIAL STATEMENT.

PUBLIC DEBT REDUCED. PROGRESS OF LAND SETTLEMENT. In placing the Financial Statement before the House of Representatives on Wednesday the Prime Minister stated:— AGRICULTURE. The dry summer to some extent reduced the production of grass, cereals, and fodder crops, and as a consequence the output of butter was somewhat affected, but nevertheless the total value of the dairy produce of all kinds exported during the year was well ahead of that for the previous year, the respective figures being £18,576.474 and £16,207,053 The importance to the country of the dairy industry is well illustrated by the fact of its exportable surplus being valued at over £18,500,000. The wool clip for the 1923-24 season was good, and in clean condition, and a marked continuous increase in prices was maintained throughout the series of sales, the average price* for the season being 16d per lb, against 101 d for the previous season. The declared value of the wool exported was £15,255,264. as compared with £11,955,567 for the pro vious period. The greater portion of the whole clip was sold at the local auctions, the proceeds consequently becomingpromptly available to growers. It is very satisfactory to record a sub aiantial increase in the numlier of cattle and sheep in the dominion, and also an addition to the number of pigs. In cattle

the increase is almost wholly in the dairy classes, and in sheep largely in the breeding ewes, and in both these directions a further increase may be expected. The health of all live stock has been good. Lamb and mutton have realised very satis factory prices during the year, especially lamb, and the prospects for a continuance of good returns are encouraging. The need of maintaining our export meat at tne best standard of quality must never be lost sight of. Trial shipments of eggs to the London matket during the year were successful and should lead to a development of this trade in the near future. The quantity and value of the exports of the under-mentioned products were as follow, the total value under these headings snowing an increase of over £6,000,000 for tile year : Quantity. Value. Beef (frozen and salted), cwt 712,533 844,187 Mutton and lamb (carcases) ... 6,323,871 8,615,619 Other meats (including bacon and pork) ... 382 249 Tallow, tons 26.358 852’471 Casings, lb 2,755,845 507,819 Sheepsems (woolly) and Pelts : 9,127,383 1.294.855 Hides and skins ... 999,181 774.125 Rabbitskins 14,951,746 493.708 Live stock 106,430 Other miscellaneous items 33,811 Wool (bales) ... ... 736,713 15,265,264 Dairy produce 18,576,474 £47,747,012 Owing to a reduction in the areas sown, and to unfavourable weather conditions during the growing period, the production of wheat and oats shows a decrease, and it will be necessary to import wheat and oats

to the value of £1,250,000 before next season’s harvest is ready. The quantity of phormium hemp graded during the year shows an increase of nearly 6000 bales. It is still necessary for millers to give greater attention to the output of fibre of a better and more uniform quality. The prospects of the fruit industry are improving. The substantial assistance granted to growers by the Government guarantee of Id per lb net return on fruit exported, and by the help afforded in other directions, has improved the condi tions of the industry. The exports for the year were not far short of 150,000 cases, and foi the current season will show an increase to over 240,000. The export of honey is now well established, although the figures for the past year show a decrease, due mainly to unfavourable weather conditions having reduced the season’s production. The prospects cf the pastoral, agricultural, and horticultural industries of the dominion were never better than at present, and this, in conjunction with the high degree of intelligence and industry for which our rural population is noted, give very substantial ground for confidence in the future of the dominion. For the purpose of providing young men who intend to follow agricultural and pastoral pursuits with better opportunities for acquiring up-to-date and scientific knowledge by which Production may be increased it is intended to give Government support and assistance to the establishment of at least one, and Inter on possibly two, agricultural colleges under trained and competent instructors. The necessary equipment will be provided to enable our farmers to compete successfully with other countries which are apparently endeavouring even now to capture the markets of the world so far as agricultural and pastoral products are concerned.

PUBLIC TRUST OFFICE. The value of estates and funds actually under the control of the Public Trustee on the 31sf March, 1924, was £32.404,724. This represents an increase of £3,499,926 for the financial year. The new estates accepted for administration during the year numbered 2739, with assets of a total value of £3,781,155. The administration of 478 of these new estates was completed before 31st March, 1924, while 1574 others were, also closed —the total value being £1,108.254. The rates of commission were reduced from the Ist April, 1923, and also made inclusive of certain fees previously charged to the estates, and there is no doubt that the volume of new business has been increased as a result. The investments held on the 31st March, 1924, on behalf *6l the common fund, and on behalf of estates and funds, the moneys of which are specially invested, amounted to £19,895,285. made up as follows: Mortgages £12.997.242 Local bodies’ debentures 5.079,135 Government securities 1,364,543 Land Settlement Finance Act debentures 55,698 Fixed deposits with banks ... 7,062 Private debentures and shares in companies ... 4,943 Overdrafts by way of advances to estates and to beneficiaries 315,203 Properties acquired by foreclosure 71,459 £19.895,285 Of this amount, the total advances made during the year amounted to £2,198,185, made up as follows : Mortgages _ £1,422,870 Local bodies’ debentures 438,745 Government securities 336,570 £2,198,185

WAR EXPENDITURE. The gross expenditure from vote “War expenses” during the year ended March 31, 1924. was £370,496, the principal items being £124,217 for the medical treatment of discharged soldiers for war disabilities, £IIO,BOB on account of our liability for transport of troops, £12,182 towards erection of battlefield memorials in war areas, £31,952 towards cost of construction of cemeteries and war graves, £23,070 in connection with repatriation advances and expenses, and £68,267 for other miscellaneous war expenditure. Receipts from sales of surplus stores, medical stores, and other miscellaneous credits totalled £77,531, which with £133,834 received in repayment of repatriation loans left a net expenditure of £159,131 for the year. The balance of claims from the Imperial Shipping Liquidation for troop-transport charges against New* Zealand, amounting to £800,009 net, was recently received. As the result of close examination, these were reduced to approximately £200,000, and a progress-payment of £IOO,COO was made in March last. The balance is provided for in this year’s estimates. The War Expenses Account will be closed at the end of the present financial year. REPATRIATION. Since December 31, 1922, the benefits under the Repatriation Act have been restricted to tubercular or other seriously disabled soldiers. Financial assistance paid out to such men during the 12 months ended March 31, 1924, amounted to £17,379, making the total moneys advanced to soldiers by the Repatriation Department £2,371,831, of which sum £1,956,674 was by way of loan. The major portion of the work—namely, the collection of loans outstanding—was transferred to I be Office as from April 1, 1923, and the total repayments now amount to £1,412.973, being over ™ Bor cent, of the total loan advances. I no complete transfer of this branch to the btate Advances Office will be effected this year. NATIVE TRUST OFFICE. As the purpose for which the Native Tiust Office was established are becoming more widely known among the Maoris, they are taking increasing advantage of the .acuities afforded to borrow moneys for the improvement of their lands Last year 438 applications were dealt with, and was ar!v anced, making a total of to date. It was found possible during the year just ended to increase b v i per cent.'the rate of interest on moneys held on behalf ot beneficiaries, and this has given general satisfaction. PENSIONS. The following payments were made during tb e year ended 31st March, 1924 War pensions £1,306.652 Old age pensions 765,392* Widows’ pensions 202 364 Miners’ pensions ... ... "! 36.'060t Mrori War pensions 30.326 Epidemic pensions / " 32507 Pensions under Civil Service Act. 1908 21 025 Military nensions under Defence Act, 1909 ; 3>146 Pensions under Judicature Act', l- 08 . 2,889 roiioe pensions 4 86 Sundry pensions and annuities... 4,374 „ T , , „ „ £2.405,221 Includes £33.338 expended from National Endowment revenue. tlnc.ludes £.7499 gold diriv collected under Miner s Phthisis Act, 1915. WAR PENSIONS The total of the actual payment made in respect of war nensions to the 31st March 1924, is £10,139,996. The annual liability in respect of each class of war pension at the close of the year is shown in the following table:— Number AverClass of Annual age of pension. pensions. value, pensions. £ £ Soldiers (permanent) ... 6,784 333.946 49 Soldiers (temporary) ... 7,731 407,847 53 Dependents (temporary) 807* 62,916 73 Widows and guardians of children ... 1,977 f 203,342 103 Other dependents of deceased soldiers ... 5,867+ 205,075 35 23,166 1, £10,126 52 *Covers 1208 children. fCovers 2138 children. JCovers 31 children. The amended War Pensions Act passed last session provided for a. War Pensions Appeal Board and the payment of economic pensions. Of 309 appeals, 144 were dismissed and 121 upheld, the remainder being in abeyance or otherwise dealt with. There are still some 400 appeals to be disposed of. In regard to economic pensions, 924 claims were established between the Ist September. 1923, and the 31st March. 1924. These, with the 1343 cases already in receipt of supplementary pensions when the Act was passed, made a total of 2267 grants under this bead, the annual value of which totalled £132.288. SUPERANNUATION. The subsidies and contributions of the three funds for the year were as follows: — Contributions Subsidies by Employees. Public Service ... £136.000 £228,000 Teachers 68.000 102.000 Railways 125,000 133,000 £325.000 £463,000 Since the inauguration of the three funds the State has paid in subsidies £2.100.000, while the employees’ contributions during the same period amounted to £5,000,000. The requirements for the current year are: —Public service fund, £136,000; railways. £170.000; teachers, £63,000; —total, £374,000. PUBLIC SERVICE FUND. The total number of contributors on March 31 last was 15,021, and the total revenue for the financial year was £475,166, including members’ contributions £228,313, interest on investments £110,146, and Government subsidy £136,000, including a special payment of £50,000 in addition to the annual charge of £86.000. The total amount expended during the financial year was £300,489, which comprised retiring and other allowances £240,611, refunds of contributions, £53,722, cost of administration £6156. The total number of allowances existing at the end of the year was 2356,

representing an aggregate annual payment of £251,988. The amount of the total fund invested on March 51 last was £2,007,766. GOVERNMENT RAILWAYS FUND. At. March 31, 1924, the fund amounted to £671,827. an increase of £87,608 for the year. The receipts were : —Contributions, £133.148; interest, £28,565: Government subsidy, £125,000, inclusive of a special payment of £50,000 in addition to the voted amount of £75,000; fines and donations, £437; —total, £287,150. The expenditure from the fund amounted to £199,542. including retiring allowances, amounting to £157,238. TEACHERS’ FUND. This fund amounted on January 31, 1924, to £558,662, an increase of £79,026 for the year. The revenue for the period was £214,190, including contributions £101,632, and interest £48.725 The Government annual subsidy is £68,000. The expenditure for the year amounted to £135,164, including retiring allowances £112,861, and refund of contributions £19,179. COST-OF-LIVING BONUS TO ANN LTTANTS. The cost-of-living bonus to public service annuitants in receipt of less than £IOO per annum involved an expenditure in 1923-24 of £40,019, and you will be asked to make similar provision this year. The present bonus payment of £l3 to widows in addition to the annuity of £lB per annum, and also the additional £l3 for each child, is being made permanent. NATIONAL PROVIDENT FUND. The membership of the fund at the 31st December was 23,200, the contribution income £143,000, the State subsidy on contributions £36,430, and the accumulated fund £980,000, an increase of £190,000. It will be seen that the fund is now well within sight of £1,000,000. The sum of £15,000 was paid out during the year in allowances to annuitants and to widows and children. An amount of £40,000 was paid by the Stale through the fund by way of maternity allowances —£7000 to contributors and £33.000 to members of approved friendly societies. LAND SETTLEMENT. Approximately 380,636 acres, subdivided in 977 holdings, and comprising practically everv class of land, were opened for selection during the past year; whilst, excluding miscellaneous leases, approximately 459,289 teres of Crown, settlement, and national endowment lands and reserves, subdivided into 942 sections, were taken up during the same period. The miscellaneous leases issued during the same period numbered 1148 holdings, comprising an area of 59.19 C acres. The subdivisions of Mount Pisa Run were all disposed of, sund the Teviot sections and runs are open for selection. At the present time there is an area of some 508,000 acres available for settlement. Some 12,087 acres were set apart for selection by discharged soldiers during the year. The policy is now, however, to open practically all lands for general application. Proclamations were issued during the year revoking the setting apart for discharged soldiers of an area of 64,044 acres in order that the lands could be so reoffered. The principal officers of the Lands Department are at present very fully occupied in connection with the pressing duty of revaluing discharged soldier settlers’ holdings. On the completion of this important work they will again concentrate on the Government’s policy of vigorously promoting land settlement, especially in making adequate provision for the youths who have reached manhood since the conclusion of the war. There are many such who are both capable and desirous of acquiring land and taking an active part in the settlement of their country. LAND DRAINAGE. The various land reclamation projects under construction have been energetically prosecuted throughout the year, and with the aid of the recently imported excavating machinery much work has been accomplished. On the Hauraki Plains some 43,000 acres have been reclaimed and settled in small areas. This-settlement has been, as a whole, most successful, and now comprises one of tho most prosperous dairying centres in the dominion. The capital value of the reclaimed portion of the plains to-day is in the vicinity of £2,000,000. Works on the Rangitaiki area, which comprises some 90,000 acres, are on the verge of completion. The output of dairy products in this district is steadily increasing. At Kaitaia, where an area of 20,000 acres of swamp country is under development, the works are well forward.

The Waihi swamp, 11,000 acres, should lie reclaimed within two years Of the Crown area some 1700 acres have been or ere about to be opened for selection and the balance, which is particularly low-lying, i* being developed with a view to disposal Jor flax cultivation.

Extensive exploration surveys of the swamp areas in the vicinity of Hamilton are now in hand, and from the information available it appears that there will be a big- field for future development in that locality. IRRIGATION. The large sum of £95.466 was expended on irrigation works for the year just ended, and considerable areas of land were brought into intensive cultivation. The localities operated on included, amongst others, Ida Valley, Tarras. Ardgour, Roxburgh, and Mafiuherikia Valley. To encourage settlement the rates charged to the farmers are levied on a graduated scale, commencing at a low figure for the first year, and rising to the maximum in fhe fifth year, the object being to avoid undulv harrassing the settler when the calls upon his capital are greatest —i.e., when he is developing the land. It is proposed to proceed actively with the works now under construction, and other schemes will be inaugurated as the land is taken up in connection with the schemes already completed. As the actual irrigation proceeds, the necessity for drainage works to carry oft surplus waters becomes evident, and will be attended to as required. To minimise this work, constant propaganda against water waste is being carried on. KAURI GUM INDUSTRY. In 1923-24 a large volume of business has been done in the industry. The department’s sales for the year amounted to £23,000, whilst purchases were made to the amount of £6500. Buying was earned on only in districts where acute distress existed, and with a view to tiding the diggers over temporary difficulties. As private buyers commenced to operate the department ceased making purchases for the time being. DEPARTMENT OF HEALTH. The subsidies payable to hospital boards for 1823-24 were £415,126, the actual amount paid being £412,945. It is estimated that an appropriation of £510,000 will be required for the year 1924-25, about £60,000 of which will be due to the new subsidy rates under the Act of 1923, and to the anticipated increase in proposed capital expenditure. It is expected that the relief to be afforded to the rates by the new subsidy scheme will enable boards to meet capital expenditure by levy and subsidy rather than by loans. The net expenditure of the department from the Consolidated Fund, other than subsidies, was £77,801 less than the amount appropriated. Considerable further savings were effected in the administrative cost of the institutions taken over from the Defence Department, apart from the saving effected by the closing of tihe Trentiham Hospital, while recoveries considerably exceeded the estimates, particularly in regard to the collection of patients’ fees. The amount asked for this year is £8027 less than that appropriated last year. MINING. The value of the minerals, other than kauri-gum and coal, produced during 1923 was £1,118,412, as against £903,259 for the previous year, an increase of £215,153. principally due to the increase of £162,182 in the production of gold and silver bullion. The quantity of coal produced during 1923 was 1,969,834 tons, an advance of 112,015 tons over the production of the previous year. In the past year 8678 persons were employed in the metal mines, coal mines, and stone quarries of the dominion, an increase of 648 over the number employed during the year 1922. The output of coal from the State collieries for 1923 was 151,403 tons, as against 123,531 tons for 1922, an increase of 27,872 tons. The greater part of this increase is from the James State Mine, which has now reached the productive stage. The indications are that the State coal mines accounts will show a satisfactory profit. FREE OF-INCOME-TAB SECURITIES. By means of redemptions, conversions, cancellations, and renewals, a further reduction has been made in these securities, the amount so reduced in the past financial year being £3,255,355, the total holding now standing at £40,990,645. The amount held in 1921-22 was £51,733,405, so that the substantial reduction of £10,742,760 has been brought about. The amount paid for the purchase below par of these securities from the public from July, 1922, to Aia IVI I 31, 1824, was £695,468, showing a net profit of £21,662. CONTROL OF CREDITS IN AID OF EBPENDIU RE.

Last session the Public Revenues Act was amended in the direction of providing that the total amount of receipts applied in aid of the gross expenditure of a vote must be limited by the amount of the estimated reeepits shown in tho estimates. Previously a department having an excess of receipts was enabled to utilise them to the full

extent thus exceeding the appropriation made by Parliament. The change has improved parliamentary control, and tends to increased economy. If departments fail to realise their estimated receipts, the shortage can only be made good either by reducing expenditure or by obtaining parliamentary authority for the deficiency. As a result, some slight alteration has been made in the form of the estimates of expenditure for the current year, in which the amount of expected credits is shown in reduction of the gross estimated expenditure of each vote. The expenditure of a vote must not exceed the net amount, plus the amount actually realised by the credits-in-aid, but may net exceed tho amount so appropriated. Ims means tho Parliament authorises the appropriation of credits-in-aid up to the amount stated in the annual estimates and that expenditure cannot therefore exceed tne amount voted, even if credits in excess of the estaimate are received. INSURANCE OF PUBLIC BUILDINGS. The claims against the Fire Insurance t- und tor 1923-24 were £14,018, as against receipts amounting to £12,503, thus reducinrr tne balance of the fund from £46,825 at" /; oril 1, 1923, to £45,310. The fund was established in 1913 for the purpose of the rebuilding or restoration of public buildings destroyed or damaged by five. The receipts comprised the annual contribution of £10,006 from the Consolidated Fund and £2503 interest credited by the Public Trustee. The large number of five losses m respect of school buildings accounted for £12.490 of the claims, and only £1528 was required for other buildings. DEPARTMENTAL BALANCE SHEETS. Owing to the early closing of the session last year, a sufficient number of departmental balance sheets in commercial form was not available for presentation before the House rose. These, however, are being submitted to honourable members this session. and similar accounts for the year ended March 31, 1924, will be laid before you later. The publication of these balance sheets has resulted in improved methods being adopted for the recording- of assets and their disposition, and a more clearly defined procedure as regards the charging of expenditure against either capital or revenue. The examination of these accounts has also ensured that no losses are written off unless parliamentary authority is obtained. This reform is having a marked effect on the control of expenditure, departments now being faced with the results of their estimates and decisions. Parliament, with these balance sheets before it, should be in a better position to ensure effective results from the expenditure it authorises. PUBLIC DEBT. Sinking Gross. Funds. Net Debt. March 31 — 1922 ... £219,054,385 £10,655,394 £208.398 9SI 1923 ... 218,953.324 11,879,256 207'.074i068 1924 ... 221,616,351 12,974,028 208:642,333 In 1922-23 the net debt showed a decrease of £1,324,923, notwithstanding the fact that £5,234,818 had been borrowed and expended for public works and other purposes. I have pleasure in recording that the operations of the year 1923-24 disclose a somewhat similar result. The sum of £2,679,450 was loaned out of the accumulated surpluses and other accounts to the State Advances Office, and as the securities issued by that office are charged against the debt, an increase is therefore disclosed by the accounts. If, however, this amount is excluded the gross debt shows a decrease of £16,413, added to which Sinking Fund contributions and accretions amounting to £1,094.772 reduce the net debt by £1,111,185, although £4,600,000 was borrowed for works and settlement purposes. The debt operations for the year 1923-24 may bo summarised thus: Gross debt, March 31, 1924 ... £221,616.361 Accrued sinking fund 12,974,028 Net debt at March 31, 1924 ... £208,642.333 Less amount borrowed for State advances 2,679,450 Net debt at March 31, 1924 ...£205.962.883 Net debt at March 31, 1923 ... 207,074,068 Decrease in net debt for 1923-24 excluding amount borrowed for State advances purposes £1,111,185 The amount raised for all purposes, including redemptions, totalled £15,264,502, loans aggregating £12,601,465 being dedeemed, £4,656,955 being provided by cash and £7,944,510 by the issue of fresh debentures. The amount of £15,264,502 was raised for the following jjurposes : Public Works Fund — General Purposes Account ... £4,000,000 Waihou and Ohinemuri River Improvement Account 60.000 Education Loans Account 200 Discharged Soldiers’ Settlement Account 37,500

Native Land Settlement Account 320,000 State Advances Loan Account ... '*2,600,000 Hauraki Plains Settlement Account 80,000 Rangitaiki Land Drainage Account 52,000 Swamp Land Drainage Account 63,000 Samoan Loan 8,000 7,220,700 For redemption of loans 7,941,080 For charges and expenses of redemptions 104,722 Total borrowed £15,264.502 * Does not include charges and expenses ot raising loans. REDEMPTIONS AND RENEWALS. The loans win oh matured during the year amounted to £13.570,015, to Which must be added £5560 matured loans for which debentures had not been presented up to March 31, 1923, making a total of £13,575,575. Of tills sum, securities amounting to £7,173,675 were redeemed (not including- redemption of funded Imperial debt), and £6,397,965 at rates of interest varying from 4 to 5 per cent-., leaving £3935 unpresented. In addition to the redemption of securities at maturity £7.173,675, other securities totalling- £5,427,790 were redeemed as under : In terms of section 24 of the Finance Act, 1921-22 (before maturity) £5,134.826 •Funded debt 292,964 £5,427,790 Making a total of £12,601,465 paid off from Ihe Loans Redemption Account and surplus revenue, as follows : Transfers from—Ordinary Revenue Account ...£1,367,401 Ordinary Revenue Account (for funded debt) 292,964 Public Works Fund 500,000 Electric Supply Account ... 31,400 Land for Settlements Account 47,550 Discharged Soldiers’ Settlement Account 3,100 War Expenses Account 2,212.840 Sinking funds set. free 201,700 Debentures redeemed by issue of securities 7,944,510 £12,601,465 SUBDIVISION OF DEBT. The gross debt at 31st March, 1924, maybe subdivided as under : —• Public debt— Ordinary debt £117,290,539 Discharged soldiers’ settlement (ineluding purchase of estates) ... 9,791.116 War debt 77,434,184 State Advances purposes _ 4.458,122 State Advances debt (incurred prior to 1913) ... ... ... 12,642,400 £221,616,361 DISTRIBUTION OF DEBT AND ANNUAL CHARGES. Tho debt at the 31st March, 1924, was held as under :—■ Gross annual Held in—- Amount. Charge. New Zealand ... £104.632,868 £4,554,057 Australia 2,106.600 86,828 London .„ ... 114,876,893 4.977,563 £221,616,361 *9.618,448 Annual sinking funds ... 739.442 Repayment of Imperial debt ... 307,718 Total gross charge 10,665,608 Estimated recoveries from trading and other accounts 2,108,111 Net. annual charge at 31st March, 1924 £8,55(,49i WAR DEBT. By the purchase of free-of-income-tax securities, the application of capital repayments to redemption purposes, and Imperial debt repayments the net war debt thus shows a reduction during the past three years of £6.279,673. The reductions represent a decrease in the annual interest and sinking fund charges of £160,276. year Sinking Decrease ended Gross Fund Net in March 31 War Debt, accrued. War Debt. Net Debt. ISO! 81,538.570 2.507,165 79,031,405 1902 81.813,543 3.451,107 78.392,436 638,969 1«i23 80,563,885 4,160.060 76.403,819 1,988,617 1924 77,434,184 4,682,452 72,751,732 3,652,087 Total reduction in net debt ... £0,279,673 ACCRUED SINKING FUNDS. The sinking funds accrued are — Public Debt Extinction £2.961.289 War Loans ... 4,682,452 Naval Defence 1,017,144 State Advances Office 1,834,680 State guaranteed Advances—(Lands for Settlement Branch) 1,117,328 Sta te-guaranteed Advances—(Olher Branches) ... 19,317

Local Bodies Loans 799,601 Old War and Defence Loans ... 192,691 "New Zealand Loans Act, 1863” 2,207 State Coal Mines 35,407 Westport Harbour 303,230 Nauru and Oceans Islands Account 7,227 Samoan Loan Account 1.455 £12,974,028 ASSETS. The following assets, and capital expenditure may be set off against the debt:— Assets interest bearing advances made by Treasury (Schedule 1), £21,964,675; Bank of New Zealand shares, nominal value £1,500,000 cash, in the public account and in the hands of officers of the Government* £3,264,287, less liabilities outstanding March 31, 1924, £1,780,503—£1,483,784. Crown lands estimated value (including settlement lands, native lands, and education reserves), £29,620,060. Electric power supply and development (capital cost), £2,923,853. Investments of cash balances (schedule II), £6,430,685; land drainage schemes, £1,363,900. Nauru and Ocean Islands, £600,000. New Zealand Consols, investments and cash, £475,992. Railways (capital cost, including unopened lines and assets taken over from provinces), £48,265,377. Reserve fund securities at cost £2,000,000. Sinking funds accrued, £12,974,028. State advances, mortgages, and property held, £22,007,586. State coal mines, £227,600. Telegraph extension (capital costs), £6.219,411. Westport Harbour works, dredging plant, etc., estimated value of assets taken over, £BOO,OOO. Total, £158,856,951 not directly interest-bearing. Lighthouses, harbour works, etc., £1,194,893. Public buildings (including school buildings), £10,515,970. Recoverable advances (to other Governments and in respect of silver and bronze coin), £65,598. Samoan Crown estates estimated value (pending complete valuation) of late enemy property taken over in Samoa, £500.000. State forests, estimated value ot forests, reserves, tions, and nurseries, £37,000,000. Tourist and health resorts, £33b,880. Total, £49,613,341. , ■ * Does not include local bodies deposits fundc, sinking funds, loans redemption account, or New Zealand consols account. Table’No. 17 continued. Assets continued. Indirectly productive development of min. ing £882,975. Immigration, £2.689.075. Irrigation and water suoplv, £493,217. Lands improvement £195.505. Roads (including roads on Crown lands), £16,001,855., Timber supply, sawmills, etc., £34,706. V\ aihou an d Ohmemuri Rivers improvements, £580,605. £20,678,028; total, £229,148,320. Advances made by Treasury schedule (1). Mining, £46,481;’ Kauri gum, £75.000; loans to employers for workers’ dwellings, £3620; loans to’local bodies (annual interest receivable, £85,000, capitalised at 4 per cent.), £2.125,000. Samoa (loan), £95,000. Repatriation (advances outstanding March 31, 1924). £579,674. Discharged soldiers’ settlement balance ou mortgage, £17,805,900._ Securities acquired by the Crown and in course of realisation, £1,234,000, £19,039,900; total. £21,964,675. Investments of cash balances of publio account schedule (II) ordinary revenue account. £3,074,337. State Forests Account, £144,700. State Coal Mines Account, £20.000. Public Works Fund (general purposes account), £150,000. Railways Improvement Authorisation Act, 1914, Account, £821.000. Electric Supply Account, £1,253,008. Cheviot Estate Account, £202,540. General Purposes Relief Account, £23.500. Education Loans Account, £41,100. War Expenses Account, £87,760. Land Assurance Fund Account, £73,890. Main Highways Account Revenue Fund, £237,000. La «d for Settlements Account, £IOO,OOO. National Endowment Account, £75,000. National Endowment Trust Account, £7OOO. Discharged Soldiers Settlement, Account, £68,500. Discharged Soldiers’ Settlement Loans Act, 1920, Depreciation Fund Account, £211,250. Nauru and Ocean Islands Account, £40.000. £6,430,685. Stores and supplies on hand not included in assets. PUBLIC DEBT EXTINCTION. The cost of the public debt is an outstanding problem in every country, especially in those who have war debts, the charges and repayment of which must be met out of revenue. A reduction in the charges of the debt lightens the annual burden and should be coincident with a reduction in taxation. In Great Britain since the Armistice there have been some very substantial surpluses—viz., £45,700,000 in 1921-22 £101.500,000 in 1922-23, and £48,000.000 in 1923-24. The British Government has steadily adhered to the application of surpluses for debt reduction. New Zealand being in process of development, and therefore a borrowing country, the Government thought it better to use the surpluses for revenue-earning purposes in the way of development rather than for reduction of debt. It is intended to proceed with the Publio Debt Extinction Bill introduced last session.

but which was, in view of the great importance of the proposals it contained, held over to afford honourable members ample opportunity to make themselves thoroughly familiar with its provisions. The Bill proposes to substitute a regular and definite programme for reducing the public debt instead of continuing to pile up an asset of funds which is not readily available, and which eventually may occasion financial embarrassment. The safe keeping of the accrued sinking funds is adequately provided for. They will be preserved intact, but the interest they earn is to be added to other funds available for public debt reduction, and will be applied annually to that purpose and no other. There is nothing in the Bill which will prevent the continued application of surplus revenue to debt reduction purposes for which provision was made in section 24 of the Finance Act of 1921-22. FUNDED DEBT. Payments amounting to £1,651,930 have been made during 1923-24 in respect of £27,532,164, loans advanced by the Imperial Government, and which were funded in terms of the agreement dated 6th September, 1922. The half-yearly payments represent both principal and interest, and the following table shows how the debt has been reduced to £27,093,029 at the 31st March. 1924: Balance of debt outInstalment paid. Interest. Principal, standing £ £ £ Ist Dec. 1922 684,794 141.171 27,390,993 Ist June, 1923 681,282 144;683 27,246,310 Ist Dec., 1923 677,634 148,281 27,098,029 The sum of £20,000 has been received from the Imperial Government, being proceeds of sale of material when the battlecruiser H.M.S. New Zealand was broken up. As the original funded debt includes an amount of £963.131, part of the naval defence loan raised for the purpose of building this battle-cruiser, it is proposed to apply the £20,000 towards reducing the debt. A further sum of £IBO,OOO has been received from the Public Trustee on account of sinking fund on the same loan, so that a total of £200,000 can be utilised for further reduction of the funded debt. In terms of the agreement the New Zealand Government has the right at any time, on giving three months’ notice, to repay at par any part of the principal. Any such repayment, however, does not affect the amount of the total annual payment of £1,651,930, which continues unchanged until

the whole of the principal is repaid, but the outstanding debt is reduced by each repayment. There is a possibility that I may be able to arrange a reduction in the annual charges as interest rates become easier. LOANS PALLING DUE. Loans falling due during the seven years ending with the year 1931, excluding Imperial debt repayments, are : Tear ending March 31. London. Australia. New Zealand. Total.

£30,517,679 £1,350,350 £67,842,658 £89,710,687 BANK OF NEW ZEALAND. The following dividends were received from the Bank of New Zealand during the year 1923-24. Preference “A” shares (£500,000) £50,000 Preference “B” shares (£625,000) ... 62,500 £112,500 On the Ist October, 1923, the bank increased its share capital by £1,125,000. In terms of section 12 of the Bank of New Zealand Act, 1920, one-third of the new issue was, in preference “B” shares, over which the Government had the first option of purchase. Authority was obtained in section 8 of the Finance Act, 1923, to purchase 375,000 preference ‘B” shares at par out of the Consolidated Fund, and part of the accumulated surpluses was used for the purpose. This brings up the total holding of “B” preference shares to 1,000,000, which, at present market price, equals a value of approximately £2,600,000. The total amount of cash invested in Bank of New Zealand shares is now £1,250,000, and the Government holdings are: — 500,000 preference “A” shares, nominal value £1 £ 500,000 1,000,000 preference “B” shares, nominal value £1 1,000,000 £1,500,000 If the bank’s profits continue at present rates, the total shares “A” and “B” will earn an annual dividend of £162,500 —an increase of £50,000 over the dividend paid on the holding prior to the acquisition of the new shares last year.

PUBLIC SERVICE. For some time past the question of generally extending the fortnightly payment or salaries and wages of State employees to the whole of the public service has been under consideration. This system has already been introduced in several branches of the service, notably the Government Railways, Post Office, and Government Printing Office, but its extension had to be delayed an account of the increased administrative cost involved. It has now been decided to generally adopt the bi-monthly system, a concession which will doubtless be appreciated by the lowersalaried employees. STORES CONTROL BOARD. The total expenditure on stores for the year was, in round figures, £4,080,000. With the exception of a few small lines urgently required, tenders or quotations were invited for the whole of the stores purchased. The standardisation of stores in common use by departments has been proceeded with, and general contracts for the standardised article or line have been arranged with satisfactory results. It is found that merchants and manufacturers are prepared to quote exceptionally good terms and render the best service to a central authority which can make binding contracts on behalf of the whole of the Government departments. The board’s effort in this direction has been limited by a continuance of unstable markets, but the policy will be steadily pursued and extended as opportunities arise. The d isposal of surplus and obsolete stores has been reviewed and placed on a much more satisfactory basis. Departments are now required to obtain the board’s authority before effecting a sale. In practically all cases an expert valuation is made and the Treasury and Audit are advised of the prices fixed. SHIPPING CHARGES. The method of shipping material and stores for Government departments from the United Kingdom has been reviewed and reorganised. As the result of an agreement come to with the shipping companies an annual saving in freight charges of about £SOOO has been effected. It is estimated that the action which is now being taken in connection with the marine insurance cover on such material and stores will further reduce the total cost of imported goods by not less than £2OOO annually.

£ £ £ 1925 327,000 312, a)0 11,252,307 11,891,507 1926 80,000 18,550 14.144,746 14.243,296 1927 3,900 775,100 3,838,480 4,617,480 1928 ... — 185,100 6.086.816 6,271,916 1929 13,000 — 9,305,485 9,318,485 1930 ... 30,093,779 — 5,545,854 35,639,633 1931 — 69,400 7,668,970 7,728,370