New Guinea's

Deficit

Finances in Extraordinary Position

DURING the seven months of the financial year (July, 1938, to Janu ary 31, 1939) the public finances of New Guinea were:—

The Territory’s accumulated surplus, which in July was over £50,000 was down to £24,765 at the end of January.

One naturally looks for some extraord inary condition to explain so unsatisfac tory a position: but the only explanation offered by the Administrator, at the Council meeting on March 2 (according to the “Rabaul Times”) was as follows: “His Honour pointed out the various contributing factors of the decreased re venue as compared with the previous year, and said that the Territory was now feeling the effects of a reduction in trade, which is common to almost all countries in the world, and is attributed by economists to the nervous tension that exists everywhere”.

This, with all respect to His Honour, is not very convincing. The Territory, in addition to the usual revenue from the usual sources, has a very substantial income from the 5 per cent, royalty on gold exported and, instead of running at a loss, it should be accumulating a large surplus for necessary developmental works. There certainly has not been suf ficient recession in trade to justify such a bad financial position.

Rumours about New Guinea finances —mostly to the effect that there has been too lavish spending in many direc tions —have been current for some time.

It is indicated that an inquiry by a financial authority is overdue.

£ Expenditure .. 293,660 Revenue .. 258,773 Excess of expenditure . . . 34,887