Everybody
pp. 69-72 · Read in the full issue
cops it from P-NG budget
From JOHN RYAN, in Port Moresby It costs too much to directly tax New Guinea’s native people, so the Administration is cutting
costs by indirectly taxing every
body.
That’s the story of the 1970-71 New Guinea budget, which reaches a record total of nearly $242 million.
Personal taxation, company tax, hardhitting customs duties on vehicles and other ‘luxuries’ these were the items on the short-list when Port Moresby, Canberra and the Administrator’s Executive Council sat down to find ways of gathering an extra $3,500,000 to make ends meet in New Guinea this year.
Native members of the AEC were getting real power for the first time, so it would have been unwise for them to hand Treasurer J. E. Ritchie a budget plan based on higher charges on luxury items ... be cause that would have hit the 38,000 strong European community.
This year’s budget was simply a delicate matter of politics.
The answer on Budget Night (Sep tember 1) was a general levy of 2i per cent, on all imports. In effect, it means that native people are paying higher prices for their bully beef, biscuits and “lolly water” (aerated cordials) and the Treasury is getting its $3,5 million for the budget by hitting the importers with the 2\ per cent, as the imported stuff comes across the territory wharves.
For the higher income-earner, the 2i per cent, levy (as passed on by the retailers) is negligible. It’s the people on low incomes—the native buyers—who are feeling the pinch.
The higher cost is going out of native pockets onlv in dribs and drabs, over the full year, New Guinea for the New Guinean is a markedly more expensive place to live.
Examples: White Rice (a native staple) goes up .18c. a lb weight, sugar goes up .15c, tinned meat is up anything from .45 to 1.35 c a lb, mackerel pike is up .35c a lb, cigar ettes up .3c a packet of 20, and imported beer bottles are up from .18c (13 oz bottles) to .3c (26 oz) to cost the South Pacific Brewery an extra $50,000 a year—but with a promise from the brewery that it will try to absorb the cost.
New Guinea’s smallest decimal unit
New Guinea’S Budget 1970-71
Money, loans from Australia $ Grant-in-aid (handled by AEG) 33,000,000 Development grant (Controlled by Canberra) 37,750,000 To pay Australian public servants 29,250,000 Running C’Wealth Departments 14,230,000 Army, Navy, Air Force .. 6,000,000 Copper loan, Govt, equity in copper project 20,800,000 Domestic New Guinea Revenue Posts & Telegraphs 6,700,000 General Revenue (taxes, customs, leases, etc.) 73,700,000 Loans (local and overseas) .. 20,400,000 Total costs of running New Guinea 241,830,000 Cost of running New Guinea in 1969-70 .. .. 218,600,000 Australia’s contribution in 1970-71 58 per cent.
Australia has changed the style of presenting New Guinea budgets this year, so that certain portions of the money from Australia are clearly marked down for the work they will do: for instance, you can see that Australian public servants are actually being paid with Australian and not New Guinea money; additionally, $33 million has been set aside for budget-making by the Administrator’s Executive Council, as an exercise for its native members.
is the Australian cent, so the per centage increases are left largely to the retailers: it’s up to them to even out the increased charges—by ignor ing fractional increases on some items, and lumping them together to boost the price by a cent or two on others.
Knowing some of New Guinea’s retailers (native shop-owners in cluded) this means that the grossly understaffed Prices Controller is go ing to be driven mad for months to come, chasing reports of overcharg ing.
Overall, the 1970-71 budget is ‘straight’. The cost of running New Guinea is rising alarmingly, as more people come into the cash economy and as more local people graduate to higher pay levels. TTiey are demanding better social services, works and general services.
The budget papers show the bud get as only SIBS million but this is misleading. It does not take into account the extra $29,250,000 in allowances for Australian public servants, the $14,230,000 required to run the Commonwealth Depart ments (Civil Aviation, Works etc), or the $6,700,000 to get the newly autonomous Department of Posts and Telegraphs underway, or the $6 million for Army, Navy and Air Force commitments in P-NG.
The real cost of running P-NG
this year is very close to $241,830,000.
Last year, it was $218,600,000.
Loans within the territory and overseas account for $27 million this year, and Australia’s actual con tribution to New Guinea in straight out grants and loans exceeds $l4l million. About $lOO million of this will filter back to Australians here, or in Australia, through salaries, imports etc.
Thus this latest budget is simply the latest version of a financial pat tern that began emerging in 1967-68, when UN money started arriving to help Australia foot the bill here.
The only corollary at all new was the government’s revamping of the five year plan (1968-72) under which Australia was to contribute about $5OO million in five annual territory budgets totalling about $l,OOO million.
The five year plan has fallen short in several areas—as a result of guess work and poor basic figures when it was drawn up in 1968-69.
Part of the re-vamping is also the result of a clearer picture from Bougainville, of the way in which the huge Conzinc Rio Tinto copper project is going to soon put New Guinea on the credit side of the ledger. Happier budget days lie ahead.