BUDGET SPECULATIONS

Taranaki Daily News, 3 September 1935, Page 9

BUDGET SPECULATIONS

PROGRESSIVE POLICY? DIFFICULTIES OF MR. COATES. ADDRESS-IN-REPLY DEBATE. MAY EXTEND OVER TWO WEEKS. (By Wire— Parliamentary Reporter.) Wellington, Last Night.While the improved financial position of the country is enabling the Government to contemplate a more progressive spending policy for the current year, it is a somewhat difficult task for the Minister of Finance, the Rt Hon. J. G. Coates, in preparing his Budget to keep expenditure within the limits of revenue. Demands are being made for a reduction in income and unemployment taxation, for a review of the sales tax, for some relief to racing clubs and for the further restoration of cuts in the salaries of civil servants. These demands and others are based to some extent on the evidence of improvement in national accounts.

Last financial year the yield from taxation for 1934-35 showed an increase of £3,267,000 over the previous year. Sales tax yielded £2,170,504, representing an increase of £323,170; Customs revenue amounted to £7,423,597, an increase of no less than £938,583; and the surplus was about £1,626,000, compared with the deficit of £709,276 in the preceding financial year.

While these are relatively impressive figures showing how much the country has improved since the worst years of the depression, Ministers have stated that some of the gain' represented nonrecurring items of revenue, including “windfalls.” For example, the comparatively handsome surplus was largely due to fortuitous circumstances such as the exceptional yield from death duties and profits from the sale of gold. Moreover, the surplus already and automatically has been applied to the reduction of the deficits from two previous years, totalling about £2,500,000. - As against that, however, the loan conversion policy of the Government has resulted in a substantial saving on interest payments, but it, should not. be overlooked that the annual debt charge last year was more than £12,000,000, including well over £7,000,000 for interest on overseas debt.

Mr. Coates is still holding long conferences with Treasury officials and others in the work of preparing his Budget. It is gathered that estimates have not yet been completed and naturally these must have an important bearing on the Budget proposals. .Mr, Coates said to-day that the Budget was never really ready until it was presented, but that' he was, however, “getting along nicely with it.”

In the meantime members of Parliament will be able to open their preliminary election campaigns through the medium of the Address-in-Reply debate, which will be opened Jo-morrow evening by the Hon. A. D. McLeod (Wairarapa) and Mr. F. Lye (Waikato), mover and seconder. The Leader of the Opposition, Mr. M. J. Savage, will move his noconfidence motion on Wednesday afternoon, and it is' expected that he will take the opportunity to denounce every aspect of Government policy and to enlarge on the virtues of the Labour Party and the Labour plan. The Minister of Lands, Sir Alfred Ransom, will reply for the Government, and other Ministers, including the Prime Minister, the Rt. Hon. G. W. Forbes, will probably speak later in a debate which may last as long as a fortnight.