The Waikato Times With which is Incorporated The Waikato Argus, SATURDAY, MAY 2, 1925. THE BRITISH BUDGET.

Waikato Times, Volume 99, Issue 16485, 2 May 1925, Page 4

The Waikato Times With which is Incorporated The Waikato Argus, SATURDAY, MAY 2, 1925. THE BRITISH BUDGET.

The British Budget is a striking document. It was expected that Mr Winston Churchill would signalise his tenure of the office by bold proposals, and he has certainly done so. The income tax has -been reduced, although it still remains at a high figure. During the past year the debt of the country has been diminished by £34,000,000. The liability for war pensions has been reduced from £110,000,000 to £87,000,000 per annum. Savings certificates, and savings bank deposits, both show an increase. These figures are an indication that the country is progressing, and that although some businesses are suffering others are prospering. The Budget estimates arc framed to produce a balance of £26,000,000, but as supplementary estimates have been frequent of late years it would be optimistic to count on this unless revenue should be higher than expected. The great feature of the Budget is the compulsory pension and insurance scheme. All workers are to contribute at the rate of 4d per week for men, and 2d per week for women. The Government will contribute during the early days of the scheme, but it Is expected to be self-supporting eventually. At the age of 65 everyone will be eligible Xor a pension of 10s per week, what-

ever his or her private means may he. Widows receive the same sum, with a further 5s per week for the first child

and 3s jftr week for the others. The particulars received by cable arc necessarilf scanty, but we shall get fuller details by mail. In the meantime we can only say that Mr Winston Churchill has shown courage and boldness, and if his scheme is actuarially sound it should do an Immense amount to dispel the rancorous spirit that has been shown by a section of labour. Another feature of the Budget is the decision to grant preference on certain lines of produce from the Dominions. Dried fruits and honey are exempted from duty,'while the duty still remains on the same goods from foreign countries. The existing preference on Australian wines and on Empire-grown tobacco is increased, and preference on Empire sugar is to be given for 10 years. We have pointed out that the net result is likely to be dissatisfaction. Dairy produce from New Zealand and wheat from Canada receive no advantage from preference, and complaints will be made on that account. A Budget, however, is a political measure which must be acceptable to the majority, and a large number of Conservatives have a pathetic faith in the efficacy of Customs duties. Although these features of the Budget are all striking, the one by which it will be remembered is the restoration of the gold standard. The Act which prohibited the export of gold lapses at the end of 1925, and it was recognised that a decision must be arrived at during the year. The question has been warmly discussed at Home, the point in dispute being whether the country was yet ripe for the action. It was not anticipated that gold would be freed until towards the end of the year, but as circumstances are favourable at present it has been decided to liberate gold at once. This is not to apply to internal currency, as it is important that the use of banknotes as change should continue. The Bank of England is authorised to sell gold bullion in lots of not less than 400 ounces at 77s lOd per standard ounce, but gold will not be coined. The object, of course, is to reserve the gold in the country for the Bank in order to increase its power to meet demands. At present the Bank of England has a reserve of £150,000,000, which is about four times the amount which was held prior to the war. The Federal Reserve Bank of America has arranged to lend a large amount, if required, but it is unlikely that any necessity to make use of this will arise. There will be no sensational happenings at present, and there may be none in the future. Several other countries, including India and the Dominions, are returning to the gold standard, and it will create a new condition for international trade. There has been much said for and against the proposed change; the experts on one side and the public and the press on the other. As the change has been resolved on we can only wait and see what the results will be. There are one or two reflections raised by the British Budget. It is produced in the first month of the financial year; our own commonly makes its appearance In the fifth or sixth month. It would be interesting to know why our Budget should be so much later than the British. The other feature of the Budget is the evidence it gives of the immense wealth of the country. Business is depressed in some quarters, but obviously not in all. Those who go to England and return with sad tales of conditions have obviously seen one side only. Debt has been steadily reduced; the revenue has kept up. Savings have increased; the standard of living has been raised, and the death rate has fallen. In spite of the number of unemployed it is clear that the country is prosperous. Our American cousins advertise; Britain doe’s not. In this respect the Dominions copy American fashions rather than British, and sometimes forge ahead of their model. Nevertheless, when the figures are added up it is generally found that Britain heads the list, or comes somewhere near doing so.