B. I [PT. ll].

Decrease in Public Debt (including State Advances Debt), — Loans paid off during the year — From cash in the following accounts — £ Ordinary Revenue Account .. .. .. .. 1.359,237 Discharged Soldiers Settlement Account .. .. .. 4,100 Laud for Settlement Account .. .. .. .. 151,212 War Expenses Account .. .. .. .. .. 7,296 State Advances Account .. .. .. .. 300,008 1,821,853 From sinking funds set free .. .. .. .. .. 839,544 From proceeds of sale of H.M.S. " New Zealand " .. .. 20,000 Discount on securities redeemed below par .. .. .. 21,779 From loans raised in 1923-24 for redemptions in 1924- 25 .. 46,590 Treasury bdls redeemed from proceeds of Public Works loans .. 500,000 Total decrease during 1924-25 .. .. .. 3,249,766 Net increase during 1924-25 .. .. .. .. .. .. 6,198,286 Add loans outstanding at 31st March, 1924 .. .. .. 221,616,361 Loans outstanding at 31st March, 1925 .. £227,814,647 In addition to the transactions shown above, public-debt loans to the amount of £400,550 were converted or replaced, £9,941,367 were renewed, and £11,048,092 were redeemed, in each ease by the issue of fresh securities of an equal amount, while loans of the State Advances debt amounting to £81,150 were renewed and £281,150 were redeemed by the issue of fresh securities. The large amount of redemptions is to some extent due to the fact that the Government has raised money by the issue of short-dated redemption Treasury bills which required to be covered more than once during the year. In addition to the above, Treasury bills to the amount of £2,300,000 were issued in anticipation of revenue and paid off during the year. The whole of the New Zealand Consols, except a small amount unpresented, was paid off out of the Ordinary Revenue Account. The balance of the New Zealand Consols Account, consisting of £6 14s. cash and £475,985 investments, is thus freed from a corresponding liability, and these assets will be available for transfer to the Ordinary Revenue Account as a set-off against .the liability met by that account. Losses to the amount of £29,101 17s. Bd. incurred by various accounts during previous years, for the writing-off of which parliamentary authority had been obtained, were finally written off during the past year out of the Ordinary Revenue Account of the Consolidated Fund, by the cancellation of securities, the respective accounts paying small additional amounts of cash to enable the cancellations to be for even amounts. These cancellations are included in the above table showing the increase and decrease of the debt, and details are as follows : —

Loans between Treasury Accounts. A matter to which special attention requires to be directed is the system of lending between different Treasury Accounts under the authority of section 38 of the Public Revenues Act, 1910. This system came into general use as a result of war conditions, when it was difficult to raise moneys as and when required, and its growth may readily be ascertained by comparing the General Balancesheet of the Public Debt for the year 19] 3—14 with that for last financial year. The figures as disclosed by the Debenture Sales and Inscribed Stock Sales Accounts for those years are as follows 1913-14. 1924-25. £ £ Balances of above accounts at beginning of year .. 50,000 6.496,146 Dr. Transactions (purchases, &c.) .. .. .. 340,000 15,924,008 Or. Transactions (sales, &c.) .. .. .. 330,000 16,667,880 Balances at end of year .. .. .. .. 60,000 5,752,275

5

Amount of Loss Additional . , , i • it -*.i a written off out cf Cash provided Amount of Account for which Loss was written olt. . * , 1 a • , 0 ... „ , Ordinary Kevenue by Appropriate Securities cancelled. Account. Account. J State Advances Account. £ B . d. £ s. d. £ s. d. Cold-storage Advances Account .. .. 7,500 0 0 .. 7,500 0 0 Fishing Industry Promotion Account .. .. 359 8 11 0 11 1 360 0 0 Fruit-preserving Industry Advances Account .. 4,494 6 2 5 13 10 4,500 0 0 Housing Account .. .. .. .. 16,748 2 7 1 17 5 16,750 0 0 £29,101 17 8 £8 2 4 £29,110 0 0