B.—6

13

The assets held by the State which may be set ofl against the debt will be found detailed in Table No. 18 attached to this Statement. I am pleased to be able to state that as a result of considerable research into the history of the debt, the consolidated stock shown under the heading of Miscellaneous in the debt table (8.-l [Pt. Ill]) has now been allocated to the respective accounts concerned. This for the first time enables a true apportionment of the public debt to be made, and ensures a more accurate capitalization of the various Government undertakings, an important consideration in view of the balance-sheet system now in operation. A separate paper (8.-2) to be laid on the table of the House will explain the results of the investigation. SINKING FUNDS AND DEBT REPAYMENT. Sinking funds as below exist for the extinction of that portion of the debt to the following appropriate accounts : — £ State coal-mines .. .. .. .. 48,199 Nauru and Ocean Islands .. .. .. 19 Samoan loan .. .. .. .. .. 4,747 Westport Harbour loans .. .. .. .. 186,558 Electric supply .. .. .. .. .. 17,391 State advances .. .. .. .. .. 2,017,348 £2,274,262 By the Repayment of the Public Debt Act, 1925, means are provided whereby the whole of the public debt, other than those portions for which separate sinking funds exist, will be extinguished in approximately sixty years from the time of coming under the provisions of the Act. The Redemption Fund Capital Account, established by section 8 of the Act, is as under: — Moneys held by the Superintendent,'" State Advances £ Office .. .. . . .. .. 3,258,956 Moneys held by the Public Trustee .. .. 7,966,689 Moneys transferred by way of loan from the Consolidated Fund to the Discharged Soldiers Settlement Account .. .. .. 13,500,000 £24,725,645 Interest earned by this amount is credited to the Consolidated Fund as a set-off to the amount paid into the Public Debt Repayment Account under the provisions of the Act —viz., \ per cent, of the public debt outstanding which comes under the Act, and 4 per cent, of the debt redeemed in accordance with the Act. LOANS FOR STATE ADVANCES AND OTHER PURPOSES. As shown above, the amount of £6,346,955 was borrowed last year for State advances purposes. £2,000,000 of this was included in the London loan of 1925. Apart from other small loans the Government, in order to provide funds to meet arrears of applications for State advances, placed a s|-per-cent. issue on the market. Up to the 31st March, £4,233,705 had been received for State advances, of which about one-half came from overseas investors, as below : — New Zealand .. .. .. .. .. £2,086,205 Overseas .. .. .. .. .. £2,147,500 In addition to the above, £650,000 was raised under this issue for public works and hydro-electric purposes. The issue is still open to the public. After allowing for expenses, the money is expected to cost about £5 10s. Bd. per cent, per annum.

Assets held against debt. Allocation of debt.

Sinking funds and debt repayment.

Loans for State advances, &e.