A Budget of Big Figures—Australia's Wonderful Wealth—Light Taxation—Prohibition Contests —Blunders of Bolshevism From Our Own Correspondent, Melbourne, Sept. 20.
Sir Joseph Cook, p.c., Treasurer of Australia, has' delivered his budget speech covering the finances for the past year and the estimated! receipts and expenditure for the year ending June 30 next. it is not too much to say that his figures have quite staggered the people. Before the war the annual expenditure was £25,000,000, for the current year the Treasurer expects to spend £98,000,000.
At first the Press generally denounced this last as a most extravagant figure, but with the care-tui study of the accounts it is found that there is really very little room to complain. Of the increase of £73,000,000 no less than £62,000,- 000 is due to post-war expenses, chiefly repatriation of soldiers and interest on and sinking funds of war loans. Interest alone totals £15,000,000. In connexion with repatriation, chiefly land settlement of soldiers and the building of homes, the year's expenditure will be £22,000,000, and practically the whole of this is recoverable over a term of years. War pensions this year will require £7,250,000, and the purchase of Australia's share in Nauru, the splendid phosphate island taken from Germat will cost £1,500,000. Shipbuilding is put down at £3,000,000, and there is increased expenditure on the navy, the rehabilitation of our warlike stores, the establishment of an air force, and other largely unavoidable outlays, The Prime Minister, the other day, made the interesting statement that Defence, which to-day costs £7,000,000, could before the war have been obtained for only £4,000,- 000. The costs of food and clothing having gone up to the general public, so also have they risen in regard to the civil service, with the result that salaries and wages have been greatly increased. As these facts sink into the public mind figures which were called an outrage are now being regarded as not altogether unreasonable. buoyancy of the revenue is such that the heavy expenditure, excent upon Nauru and repatriation, will be defrayed from revenue, and the Treasurer predicts no more borrowing in connexion with the finalization of the war.
Taxation versus Borrowine.
Sir Joseph Cook admits that even for war purposes Australia has borrowed too much. In 1919-20 she only defrayed 35.3 per cent of the cost of war services out of revenue, whereas in the United Kingdom the proportion was 80.4 per cent. This year there is to be a decrease in Joan expenditure upon war services £20,000,000, while an extra burden of £18,000,000 is laid upon revenue. Yet even now only 56.4 per cent of war services will be! paid from revenue. Last year the taxes in New Zealand amounted to 3s. per head, and in the United Kingdom to £22. 3s. lid., while Australian taxes were made up to £10. 13s. 9d. by including both State and Commonwealth imposts. It is now-proposed to increase taxation by 10/- per head, or £2,500,000.
Not unnaturally there is an outery, for private opulence never cares. 10 pay up, however necessary it may be to restore the condition of public finance to a sound basis. The Treasurer puts his finger on the weak spot when he says that there ig too much dead capital in the country, and as a consequence industrial' production is hampered, with resultant high prices. by increasing the taxes and doubling the amount of the sinking fund for the liquidation of loans he releases the dead capital.
There has been the customary talk about the inflated currency. but' the Australian currency is, as the Treasurer says, but a grain of sand in the world of credit inflation. In actual fact the inflated currency seems a consequence rather than a cause of the undoubted prosperity of this country. It is not a debased currency, for the proportion of gold holdings to notes iSsued is 77 per cent.—the highest in the world, with Spain and the Netherlands as runners up. In the United States the proportion is 58 per cent., and in the United Kingdom, only 20. Apart from those who generally denounce what they are pleased to call the extravagance of the Gov-ut, the general note of ism is that Sir Joseph has been too lenient, that the immense private wealth of the Commonwealth could well be taxed more than it is, and the dead capital of the war loans more quickly release ed than seems at present likely.
Text read from the printed page and cleaned; old type leaves the occasional error.