THE PUBLIC ACCOUNTS

Waikato Times, Volume 118, Issue 19691, 26 September 1935, Page 6

THE PUBLIC ACCOUNTS

The Auditor-General has again drawn attention to the unsatisfactory manner in which exchange charges are dealt with in the public accounts, and the matter is one of importance. When the rate of exchange was raised it meant a substantial charge to the Consolidated Fund, and, of course, increased the overseas payments of sued Departments as Railways and the Advances Office. The capital required for these services had mostly been obtained in London, but the extra cost of exchange has not been shown in the departmental accounts. The result is that the annual statements do not represent correctly the year’s operations, because the cost of transferring interest payments to London is not fully shown. The Auditor-General has given instances illustrating how certain accounts benefit and a heavy burden is placed on the Consolidated Fund. It is obvious that if, say, tho accounts of the Railways Board exclude exchange payments, then to that extent they are inbomplete, and there is no need for such a course being followed.

The Government, when it introduced high exchange, knew approximately what the added cost to the various Departments would be, and the decision to make the extra charge national can be easily understood. But that could be done in a manner that would show in more detail how the costs have been incurred. The additional sum required by the Railways Board to meet tho higher exchange could be shown in the accounts and a transfer from the Consolidated Fund also shown. It would be a cross entry, but the accounts would then disclose, what they now fail to do, the actual results of the year’s working. The reports of the Railways Board for the past three years have shown a steady improvement, but unless the full exchange charges are shown it is difficult, if not impossible, to say accurately how great is the margin between the net profit for the year and the sum required to meet in full the interest payments on the capital invested. The contention of the Auditor-General that a very substantial portion of the cost last year, £1,450,000, should be debited to the appropriate accounts is reasonable.

Another most important issue was raised by the Auditor-General when he dealt with the control of expenditure. The change made in practice, limiting the work of the Public Accounts Committee solely to those matters referred to it by Parliament, has affected his position. His responsibility is to Parliament and not to the Government of the day, and his right to bring before the committee whatever matters appear to him to be of sufficient importance should be carefully protected.