FINANCIAL STATEMENT.

Stratford Evening Post, Volume XXXI, Issue 22, 11 September 1911, Page 6

FINANCIAL STATEMENT.

In the course of the Financial Statement tnc Tiendor said: — ADVANCES TO WORK MRS. Some amendments to the Advances to Workers Act will be submitted. The provision limiting an to a worker to the value of his building will be abolished to further assist the workers to provide homos for themselves. Authority will be asked to increase the present amount authorised to 1)0 borrowed by £250,000 per annum, making £i 50,000 per year, instead of £500,000. These alterations will further increase the usefulness of the measure. INCREASED LAND TAX. Since I have been bead oi the Government the number of persons who selected Crown lands amounted to 53,000. These settlers aggregate 269,200. ! have excluded from these figures all those who selected pastoral lands and leases for short or temporary periods. One thousand live hundred selectors were placed upon 412,200 acres. The amount expended during the same period in purchasing and subdividing fifty estates for closer settlement was £1,610,000, and the area acquired was 266,872 acres. Notwithstanding tiie substantial progress which has been made in the subdivision, the close settlement of the largest estates in the Dominion demand acceleration, and 1 think this can bo befet effected bv an increase in the graduated land tax on all estates where unimproved value exceeds £IOO,OOO in value. I propose, therefore, to increase the rates found in the present graduated scale on such estates by 25 per cent., and to allow owners a reasonable time to cut up their estates themselves and to give them thr.ee years bWJ-'m-c putting the increase into operation. THE DOMINION’S TRADE. Despite the fact that last year was a record one, the export trade of the Dominion for the year ending March 81 sv last showed an increase of £520,921 over the previous year, the actual figures being:—l9ll, £21,543,900 (1910, £21,491,909). The imports for the year were valued at £17,713,183, an increase of £2,359,604 over the previous year. FINANCE FOR 1911-12. There is every reason to hope that the year will be a good one. Prices for onr staple, products are on a satisfactory scale, and trade throughout the Dominion is active. There arc comparatively few out of employment. I look forward hopefully to a successful year, and I am justified in anticipating that there should be a substantial surplus at t lie end of March next. EXPENDITURE. The progress and -prosperity of the country has made such strides'that it is only natural with the increasing demand Per further facilities in railways and postal ’services, education, and the establishment of universal training, that an increased expenditure of public moneys will be required. This I estimate at £10,136,566, an increase of £793,461 over that of last year. The increases will be as follows :—Permanent charges £227,741, •departmental £565,729. The permanent charges must not raise the interest bn each sum borrowed. The principal increase is for interest, £205,104. t m - . -' will reach £6,265,975, being £565,720 in excess of that for 1910-11. The principal increases are:—Railways £104,187, education £93,150, defence £171,635. LAND SETTLEMENT.

It is desirable to enable small men or small associations of men, to whom credit is not readily ucccssiolo under our existing banking system, to obtain it for productive purposes, or purposes insuring economy. This, in my opinion, can be done by the formation of farmers’ associations of even comparatively small numbers, f propose to submit a scheme to enable this io bo done. These will be incorporated, and empowered to borrow money for purposes of loan to their members on such security as they think tit. But repayment of money so borrowed will bo guaranteed under proper conditions by the State. This will enable it to lie obtained at reasonable rates of interest from the ordinary bank, and if not so available then from other sources. Each member of the association will lie subject to proper safeguards and conditions, and be liable tor the default of any one of their number. This last provision, it is conceived, will prevent waste or abuse of the system. The security for a loan to a small farmer under such a scheme is not as necessary as it is under present banking methods—the value of the property the small farmer can offer, but rather the industry, character and skill of the farmer himself. Such a scheme provides for an expert tost of .the moral risk involved in the personal knowledge the lending associations will have of the borrower, and for a watchfulness secured by a keen sense of collective responsibility of the capacity of the borrower to turn tiie loan to'profitable account. Thus the qualifications of the small farmer for his business becomes in a largo measure the security on which he can borrow, and men with small, or even no material security, can obtain capital. Similar schemes have boon - tumid enormously beneficial by small farmers in several European countries. They have not only made capital available to struggling men, but greatly cheapened the rates at widen it could be obtained. In Germany 9-10 co-opera-tive banks of one typo alone keep about £100,000,090 steadily in circulation in credits in the country. Germany has indeed about twelve thousand* of such banks in all, and by iar the greatest number are employed in financing agriculture. 1 have every confidence in stating that as the result of close examination into the mattor, this can bo done without risk to the Dominion or injury to our financial institutions. The system of farmers’ co-operative hanks for certain specified purposes, can usually bo employed by the family land settlements, which 1 also propose to provide for. Those settlements will be promoted on the following linos. Lands now inaccessible, but well suited for settlement, will be acquired by the Crown. Of these there are considerable areas both with native and European owners, as well as areas still belonging to the Crown. A scheme, of public works will be submitted to provide communication to these areas by road or rail. Application for those lands will be called Inland applicants may be of two kinds: (I) Individual applicants; (2) applicants as associated settlers. The latter will consist of not less than ten or more than twenty-live men, preferably married men or women with families. In neither of those cases will there be allotment by ballot. A careful examination of fitness of applicants will lie made, and. suitable areas allotted to either. Public work's consisting of roads or railways will be ’promoted contemporaneously with the settlements, and where applicants arc without the means necessary- to enable them to carry out the work, of bringing their farms into cultivation ii]) to a reproductive point, settlers will bo olfoi;ed work on the roads and railways, for either a certain mim- » her of days a week, or a certain nuin-

her of weeks a month. By this means J anticipate those settlers will he enabled to carry on until their farms are sufficiently reproductive to maintain their owners. Ample facility will he given moreover to these settlers to form tanners’ co oper, i. o banks and so obtain capital to help members. This proposal, oy elimiaating the ballot system, will rei.ivo much of the present discouragement in failure to draw an allotment, and will also check to some extent the traffic which has here and there arisen in selections under, our Land Act. I expect that this system will be apply to private lands to bo voluntarily or compulsorily acquired front the present owners, both native and European, and also to large areas of Crown lands. It aims at promoting the dual purpose of public works, development and closer settlement, in order that, those, associated settlements may be made more attractive to settlers with young children. A relief telephone system, connecting the settlers with the centre from which medical aid and other urgent needs may be dbtainod,' will be supplied by the Government. STATE NOTE ISSUE. 1 propose to ask the House to change the system of issuing bank notes. These will, in future, after reasonable notice is given, be issued by the Government as is done in Canada and other places. It must be understood that this is not in any way a recognition of paper mony in lieu of the present methods of exchange. The proposal is to make a State monopoly of an operation hitherto carried out by private institutions, and will be based upon the principles of'the Canadian systm, which has worked most satisfactorily for many years past. The value of notes in circulation in New Zealand is about £1,600,000. The tax on tljis is 3 per cent. This will, of course, be lost by the Dominion, but the State will gain in other ways. The banks will 'pay gold to the ’Treasury for notes and the Sttae will not have to pay interest on money so received. The ’Treasury must keep a full reserve in gold coin to ensure the stability of the notes issued. 1 will submit further details when submitting legislation. In case of loss or destruction of notes the Dominion will, of course, benefit. There are sound reasons lor and against the change, but on the whole J am convinced that it- is in the interests of the country that the issue of notes should be the function of the State. This can be done with much advantage to the people and without injury or dislocation to the business of the banking institutions of the Dominion.