FINANCE.

Star (Christchurch), Issue 9304, 3 August 1908, Page 1

FINANCE.

AN UNUSUALLY STRONG POSITION. AMPLE FUNDS IX HAND. , IMPORTANT STATEMENT BY SIR JOSEPH WAKO. [FRO.\r Ovn Cokhkspoxdkxt.l WELLINGTON, Augui 1. The Prime Minis tor has made severs , statements in tho House of Rep re-son-tatives this session in regard to the financial position of the dominion ant has contradicted in emphatic fashion the rumours of stringency and unvesi. that have been circulated in certain quarters. Some Misapprehensions rei main, however, and to-day I waited upon Sir Joseph Ward and asked whether ho could throw some- further | liyjhfc cv iiiiuneiiil liuttei'ei, 'jjarticiilurly in view of the reported possible disorganisation of the London money market, owing to a hitch that was recently reported by cable of a South Australian tyaYJ&illion loan. "I shall be pleased to givo an outline of the financial position," said the Prime Minister. "1 have .stated moro than once that our "financial position at present was an unusually strong one, and my justification for making that j statement will by the impartial' critic bo confirmed when I say our funds in New Zealand iire r.mplo for our requirements for some time to come. The Treasury cash balnco with tnc Bunk of New Zealand yesterday was £575.000, and the total balances of iao Government accounts in the dominion wero £825.000. In addition to this there is over £600.-000 at mo credit of the various imprest account!-; of the Government officers throughout the country for payment or wages, etc., so that it will bo seen that the Government has nearly a million and a half cash in hand in tho dominion. Then, as to tho position in London, wo have in London gilt-edgod securities amounting to £856,000, which cost us £800,000. and they are in the reserve fund seeuritias account, and are- available as a margin against advances, and if required can be readily obtained. We have also £'44-="),000 securities, which cost us £400,000, in respect of the land for settlements investment account, on which advances ran also at any timo be obtained, so thafc upon the combined seeurites wo could., if required, obtain at Iwipt £1,200,000, and as the securities referred to are unpledged, thai is, uc advances are ■stundina against them, we arc occupying a remarkably strong financial position in London. '"ThfU. in addition to this, we have Parliamentary authority for a loan of £1.250,000. 1 have " already sent a delegated authority to the High Commissioner, by which at a moment's notice by cable he can in London issua debenture- stock for £1,^50,000, no that it can be aeon that if tho necessity arose for large- advances, which, at. pre;;ent aro not required, by issuing tho debenture stock that I urn now referring to in London, plus the £1,200,000 oi the- securities in tho reserve funds and land ior settlement investment account, we would have no_ lees a sum than £2,450,000 of securities available in London. I think it will be seen by anyone who Iciiowa jiny thing of our financial historj' that we have never been in a stronger financial position than we arc to-day. " Then, take j tho position of our current loans that ( are falling due during the present year, that is, between now and March 31 next. We have nearly two and a half millions under this heading. Of this amount arrangements have been made for the renewal of £1,700,000 at 3* per cent, and of the balance tho holders oi a very large amount havo already statod their desire to renew at tho due date of their present stock, and I may further state that the renewal of the whole two and a half millions falling chic will bo effected without any additional cost being cast upon the dominion. Considering this and the large amount of further securities that we have in hand, it will be gratifying, I am sure, to the country generally to know fhat a matter which Is of such importance to our people of all classes from the humblest to the highest is distinctly of a most satisfactory character. "Then lot me < for a moment look at the revenue as it stands to-day. For the twelve months ended July 31. 1907, our total revenue was £8,708,878. A ■statement of the revenue for the twelve

months ending July 31. 190?. that is up to yesterday, shows that we. arc £309.299 to tue good by comparison with the actual results of tint previous twelve months, and this, with all our reductions of revenue in operation and witli the Customs revenue of £'109,(5.-39 Jess up to that period for lUOB than for the same period oi the previous twelve months. The following table shows the actual result of the several departments : — IOCS. 1907. ilorc. Lc-3. £ £ .C £ Cu.Vtom:- . 2,985; 111 S/tfa.OTO — 100,G.39 S airrps. inciudPc:=t and Teloprarjli Cash Kceeipts . 1,539,372 1.405,765 73,607 — Ivand and Income Tax . 84.2,941 7^,177 114.H34 — Boor Duty . 116 040 103.055 6 0(11 — Bail ways .. 2.828,608 2.G3-1 J :SOO 174.503 — Kp gist rat ion and other i'ees .... 131.7-43 I-23.U0 11,G;53 — Msr.ne . . -iQA7'2 iI,7M G73 — Miscellaneous 229,(527 sl;j 7,",0 15 80S — Territorial . -2<tj.557 275.T13 2-2.211 Totals . 'J. 015,177 S,7OS,S7* 11S.H5S HA),1"30 '• Then about tho Government borrowings in ,\V-w Zealand and inU-r---feronco with tho 10.-m! money ma.rkc.-t ■nu 1 hat account. It, greyly luifiur ior any such statement to ho made. The total amount wo have borrow*';! I from tho public in New Zealand la^r I year wa« £23,000. From information j obtained from tho Australian Mutual i Provident Society the total amount of I Now Zealand money which ha!s boci | borrowed from that institution in twelve years amormts to £22,3, 000. and 1 the total amount that the Auckland bavmg.s Bank lias invested in (icver;:ment stock is £225,000, and that is over a Jen arc r period of yearn than i for the- A.M. P. (-Vjci?iy ' ; Thc;i ;>,', to life le^lh,^ «f Uu- {>,- verument In sura net- Department and tho Public Trustee in all parts of tho dominion to local public bodies. Tintotal loans to local public bodies by thePublic... .Ti-nstto for tho year ending 190G w;fe €27,000, and for thu venr 190/ £20,250, ami by the GWrmueiit Life Insurance Department for thf year 1900 £16,550. and for th« year i 15)07 £11.200, ko that tho statement j which has been circulated that w« havn bc-ou utilising thteo dopartments'* moneys in largo stir.is for loans to lecal puWu: bodies is entirely without foundation. Tho amouni: loaned by both of them to local public bodies is "a mere "dro-p^in tho bucket. Then p.k against all tin's borrowing there is tho fact that tho Government Advances to Settlers Dopartmpnt has loaned to settlers during tho same per ic<l £'l.d-00,000. and the Advances to Workc-re" Department J:as lout out to ivorker-s £210", 000, do that an. analysis under this heading entirely disprov&a tho contentions that some people Jiavo made. Po«-il>l\ they ».r«5 under the belief that their *impreE«ioiifi) were right, but an examination or" the facts shows conclusively that they have bppu working on a wrong assumption. '"' As to the Po.-i; Oflice Savings Bank, tho Government has not raised the rut\s. of interest in this important branch of the pest office. It is carried out on the earao lines now that it ha« been ] for the last forty years, and no on-o can legitimately argue that tho Post , Offico Savings Bank should bo instruct- ; ed not to accept the deposits of tho small amounts that our wage-earning clat?6 generally put there. It has also to bo remembered that tho withdraw- < als from th« Po<st Office Savings Hunk : i yearly are very large, and that from ' i tho point of view of a permanent in- ! j vestment it has to bo looked at in tho i light that the depositors may withdraw | their investments whenever thoy de- i ' siif. I hope that iho forepoinp; infer- ! mat ion maj' be of general interest. '' '