B—l [Pt. ll]

averaged 9s. 5-99 d. per case. The accounts for the first year of the Board's existence, ending on 30th November, 1949, show that the amount paid to growers, together with the cost of marketing the fruit and the administration expenses of the Board, exceeded the amount realized from sales by some £37,000. In anticipation of a deficit the Board had earlier obtained the consent of the Minister of Finance, in terms of section 23 of the Act, to the granting by the Reserve Bank of an overdraft to an amount of £43,000. It has not yet been decided how or when this overdraft will be liquidated. In this connection it may be mentioned that section 23 (b) authorizes the Minister of Finance to guarantee repayment of the overdraft with the Reserve Bank, but no such guarantee has in fact been given. In terms of section 27 of the Act the accounts of the Board have been audited by the Audit Office. Profits From Wool Disposal In terms of clause 5 of Part 111 of the Disposals Plan set out in the schedule to the Wool Disposal Act, 1945, the ultimate balance of profit or loss arising from the transactions of the Joint Organization (known as the J. 0.) in New Zealand wool is to be shared equally between the Governments of the United Kingdom and New Zealand, A profit estimated at some £12,500,000 will accrue to New Zealand under the clause. In a Treasury memorandum of 15th May, 1950, addressed to the Minister of Finance it was stated that " all the profits resulting from the operations of the J.O. scheme were in 1948 committed by the then Government to be used in establishing a new marketing scheme or in any case for the benefit of the wool industry." This commitment was made in an exchange of letters dated 27th August, 1948, between the then Minister of Finance and the Chairman, New Zealand Wool Board, and was in effect confirmed by the present Minister on 15th June last. When a question arose as to the authority for the commitment or agreement the Audit Office was referred to section 5 of the Finance Act (No. 2), 1948. It appeared to the Audit Office that that section applied only to a surplus arising from the exercise of certain functions by the Marketing Department, and had no application to profits made by the J.O. The Crown Law Office agreed with this view, and legislation will be necessary to implement the agreement. This legislation, when introduced, will give Parliament an opportunity to be informed, if it so desires, of the grounds on which the agreement is based. Parliament will at the same time decide whether it will retain control of the profits by requiring their disposal to be subject to annual appropriation or whether it will divorce disposal from annual parliamentary review by providing a permanent appropriation. An advance payment of profits of £5,000,000 has been received from J.O. by the Marketing Account, which has meanwhile invested it in Government securities. Unless the agreement is confirmed by legislation, all profits, and interest earned on their investment, will be payable to the Ordinary Revenue Account of the Consolidated Fund. Emergency Cool-storage and Meat-canning Plants During the war, expenditure amounting to some £900,000 was made from War Expenses Account, Subdivision IV, Ancillary, to provide emergency storage space for meat and dairy-produce and to enable meat-canning companies to obtain additional plant and buildings. The terms under which freezing and canning companies were allowed

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