FINANCIAL STATEMENT.

Poverty Bay Herald, Volume VII, Issue 1037, 10 June 1880, Page 2

FINANCIAL STATEMENT.

[By Telegraph.] The following la the portion of the hon. Colonial Treasurer's Financial Statement omitted from our last evening's issue for want of space : . Estimated Expenditure of Consolidated Fund 1880-81. I now comß, Mr. (Seymour, to our proposals for the current year. Hon. members will kindly bear in mind, that the land fund, by which I here mean the proceeds of land sales, and the charges against it, will be treated separately and it is therefore excluded from the estimates of expenditure and revenue which I am now about to submit for the consideration of the Committee. I need hardly say that although treated separately, the land fund remains to all intents and purposes a part of the Consolidated Revenue for the purpose of security to New Zealand bondholders. Estimates, which will be in the hands of hon. members to-morrow, show very large reductions of charges upon the Consolidated Fund as compared with last year, amounting in gross to £541,000, and but for the increase in expenditure over last year of £109,000 for interest, and £23,000 for education, over which of course the Government had no control, the reduction would have been £673,000 ; and if we deduct from this the sum of £150,000 transferred as charges against land sales, there would still have remained a very substantial reduction of £523,000. But even after making provision for this increased expenditure of £312,000 on interest and education, and allowing for loss to the revenue of the proceeds of land sales £200,000, there will be a net saving of expenditure from the Consolidated Fund of £341,000, and this without impairing the usefulness of local bodies, the efficiency of the public service, or shifting burdenß which should be borne upon the revenue to loan or other funds. The total proposed votes for the year, exclusive of liabilities, is £3,473,709, but of this we cannot spend and bring into accounts within the year more than £3,248,709. This advantage will not recur, |but fortunately comes to our aid now, thus giving the revenue time to recover its normal condition, as we ha/c every reason to hope it will by next year. There are some items of expenditure to which I desire to call especial attention of the Committee as showing the reductions which have been effected, and the directions in which Government think further reductions are possible and should be made. It will perhaps astonish hon, members to hear that we are now paying over £1,000,000 a year in salaries, pay, and wages, and £18,700 for pensions. This includes our railway ernployeys and our ordinary complement of constabulary and police. Of this sum, £643,000 is for salaries, pay and wages of £200 a year and under. The Government, Sir, as must be evident to every one, have had no time to grapple with thia enormous expenditure during the Bhort recess just terminated, but they have made reductions wherever it was possible to. do so without detrimentally affecting the machinery of the Government. We have given the subject as careful consideration as the time at our disposal would permit ; but as I have often before pointed out, the effective and permanent reductions, as distinguished from Bpasmodio efforts at economy, must be the work'of time. Sir, the Government are of opinion that it will take the whole of the next recesdjjtoj ideal with this matter, as it must be dealt with. To assist us in the accomplishment of this object, a Royal Commission has been appointed to inquire into and report upon the whole organization of the Civil Service. Its labours, will, I feel sure, be of great value to the House and Government in dealing comprehensively with this difficult subject. But, Sir, although time was necessary to deal with this subject comprehensively, and we had so little time at our disposal, we felt this could be no excuse for not at once making a beginning. Besides several minor reductions, my hon. friend the Minister for Public Works has reduced the expenditure of this department by £3G,000 without impairing in any way its efficiency. The Native Minister has succeded in reducing the expenses of his department from £46,944, which was last year's estimate, to £14,262 this year, or after allowing for transfers together of the departments, to nearly 50 per cent, the salaries and contingencies were last year £21,164; this year they are estimated at £13,453, nor is this all, for in the Land Purchase Department, which had grown into serious excrescence on the Native office, he has reduced the salaries from £10,000 to £6,000 a year, or about 40 per cent. and in both cases I venture to assert the service is being better performed than formerly. From thia hon. members will see that the hon. gentleman has more than fulfilled his promises of reduction made to this Committee last year. My hon. friend will, no doubt, explain what he has done more fully when the Native Estimates are under discussion. I have said, Sir, that we are paying over £1,000,000, yearly for salaries, pay, and wages, and this is upon the estimates which have been apparently reduced to the lowest possible amount. The Government have had under^consideration the ques* tion of reduction of salaries of Ministers. They do not think Ministers are overpaid, and they are not prepared at present to recommend a reduction in their salaries. That question will be carefully considered during the recess ; but looking to the financial^ position of the Colony, and the necessity of the reduction which must be' made in some form, we propose that 20 per cent shall be deducted from their salaries for the current year, beginning on the Ist July next. So far, Sir, the reductions are simple enough, but how to deal with the service generally is a far more difficult question, as gross and cruel unjustice may be easily done to many deserving officers if large reductions are indiscriminately insisted upon, and the efficiency of the public service may be Beriouslyf imparied. We have among our Civil Servants not only large numbers of willing and efficient officers, but we have men who would be a credit to any service, and while some of our departments urgently require reform or remodelling, or even abolishing, by consolidation with some other, I am sure they could hardly be touched

without being injured, and again, while some officers are no doubt overpaid, others, considering the value of their services, and the difficulty of filling their places, deserve mora than they get. We can therefore lay down no inflexible rule for retrenchment. Biffy $ir, an effort must be made in the interests of economy at once. We shall, therefore, propose to the House, notwithstanding the fact that the estimates have been apparently kept within the narrowest limits, that 5 per cent., or £50,000, be struck off the votes for salaries, pay, and wages ; and we shall then proceed in the manner I have indicated to make this saving, and if with the aid of the Departments, we are unable to make necessary reductions to cover this amount, we shall issue a scale of percentage showing the sum to be deducted for every employe" of the Government, whioh altogether will make up £50,000. 1 hope, Sir, the Committee will think this as a sufficient earnest of our intention to take this subject seriously in hand. The task, Sir, is very unpleasant, and a thankless one, but it is our clear duty, and must therefore be done. If then, the Committee should agree to this reduction, the total expenditure within the year will, I estimate, be £3,189,709, for which provision has to be made. Estimated Revenue of Consolidated Fund, 1880-81. In estimating the revenue of the year 1880-81, which I do at £3,190,000, full particulars of which hon. members will tind in the Table No. 7 attached to this statement when printed, I regret to say that I am unable to take as hopeful a view of the Customs receipts as I did last session. It must be admitted that there is no known basis on which to found trustworthy calculation as to the probable receipts from Custom duties. In the Colony the influences at work are so various and uncertain in their operation, that it is impossible to form more than an approximate estimate as to the receipts and for any period of financial or commercial depression such as we are still suffering under. There are, however, indications pointing to gradual improvement, which I hope ha 3 begun, but which I think I am not justified in relying upon to a larger extent than I have done in estimating the Customs' receipts at £1,250,000 for the year. It is an ominous fact that there was a net decrease of duty of £107,G84 paid at the Customs during the year 1879 as compared with the year 1878, and that more than a proportionate decrease has continued for the first quarter of 1880. Notwithstanding the large increase of duties imposed in November, 1879, the Customs receipts for March quarter, 1880, were less by £42,257 than for the corresponding quarter of 1879. The imports, too, were less in the former quarter than in the latter by £978,734, and this difference was not caused by any large falling off in the railway material and other articles imported for the Government ; the total value of Government imports being for March quarter, 1879, £95,263, as against £54,012 for March quarter, 1880. Tobacco yielded an increase of £7,193 during last quarter, but this is owing to the increased, duties ; 31,726 lbs., 12£ per cent, less being cleared than in March quarter, 1879 ; but the greater portion of the decrease may be traced to the fact that in the preceding quarter (here had been withdrawals of tobacco from bond considerably in excess of -the usual average in expectation of the duty being increased. Drapery and spirits both show an actual- falling off during laat quarter as compared with the corresponding quarter of 1879. the former of £6,346, and the latter of £7,457. Drapery yielded for the first quarter of 1880, £39,862, and spirits £82,482. Hon. members will observe that the percentage of loss upon drapery is nearly double that upon spirits, which I take as an indication that smuggling and illicit distillation have not increased to any appreciable extent through the additional duty imposed upon spirits last session. Looking at all these facts, I do not think it would be wise to estimate the Customs for the year at more than I have done, namely £1,250,000. Hon. members will see there is a considerable increase in the estimate surplus of receipts over expenditure on railways, namely £341,082. But my hon. friend the Minister of Public Works proposes to slightly increase the charges for freight, and still further reduce the expenditure. The lemaining items of estimated revenue do not, I think, call for special remark, except that I should point out that the proceeds of land sales are not included as revenue. I ha\e said thet the estimated expenditure to be made within the year in £3,189,709, and the estimated revenue £3,199,000, thus leaving a balance unprovided for of £8,709. Though I would again call the attention of the Committee to the fact that if we made out our accounts as we have done heretofore there would be a still further amount to make good of £225,000 ; but as I have said before, this will not become payable within the year, and therefore I do not propose to 'make a provision for it. I hope hon. members will understand that although this is in no sense putting off a payment which could be made during the year, yet that in future years postponed liabilities at the end will be counter-balanced of outstanding liabilities at the beginning. In other words, through beginning this year free, we have to pay less during the year than in any succeeding year by the amount of liabilities which will necessarily be outstanding at the end of this year. Land Fund. I must, Sir, here Bay a few words about the land fund, the receipts of which from all sources are estimated at £335,000. Of this £200,000 is from land sales, but has not been so included, but in accordance with our proposals of last session, repeated this evening, it has been set apart to be separately dealt with as charges, as honorable members will see upon reference to estimates, against this amount to £151,223, leaving a balance of £49,777, which, if our scheme of local finance should meet with the approval of the House, will be handed over to Local Public Works Boards. We shall further propose that in any year when the proceeds of the land sales are more than enough to pay charges and administration, and £150,000 to the Board of Local Public Works, that the balance shall be paid into the Public Works Fund.

Proposals for the Future. The Government, Mr. Seymour, had hoped to do without proposing any alteration or increase of taxation this year, and would not have made any such proposal if on the one hand the taxes imposed last session had been generally accepted with only that amount of reluctance which is perhaps a natural attitude towards all direct taxation, and if, upon the other hand, the proceeds of taxation amounted to what might reasonably have been expected J ~ but I have shown that in the Customs duties the increased rate has not sufficed to prevent a decrease in the ... amount collected.