S. CH. P.
TAX EXPLAINED
MR. CAINE'S OUTLINE OF BUDGET
EXPENDITURE TO BE:
ALL ESSENTIAL
INCREASED DUTIES
Mr. Caine said:
"Your Excellency,-You have in- dicated in their main outlines the financial intentions of Government in the new conditions which exist to- day. Circumstances have unfortun- ately compelled the Government to put those intentions before Council, and the Colony which that Council represents, in two stages. There has been no time since the outbreak of war to reach finality in our proposals for wartime measures, and then to reprint the estimates in accordance with our decisions: on the other hand, in view of the approaching end of the financial year, it was inadvis- able to defer presentation until the, estimates could be recast in print so as to conform with those later pro- posals.
"The only possible course, there- fore, was to lay the estimates as printed before the Council, to state when doing so that they would un- dergo a considerable metamorphosis, and lastly in Select Committee to re-i cast them in their new form, rather forms, for there will be two! budgets for the duration of the war, where one used to grow in peace! time.
or
very sorry for any con-
·
"I am fusion that this way of handling the subject may have caused but in thei circumstances I fear that that was inevitable.
But so far as the or- dinary estimates of expenditure are concerned the changes to be made are of a "paper" rather than a prac- tical nature: it is the defence budget where most of the innovations come. Special Budget
"We propose, as Your Excellency has said, to have two budgets; the ordinary one which will strongly re- semble the budgets of previous years, and a defence budget which will be quite new and hope a feature of only a year or two.
"After that general explanation I have to ask honourable members to turn their attention back to the ori- ginal estimates of expenditure for 1940-41 which have been in their hands for 10 days. As a memoran- dum explaining the principle matters of novelty contained in them was cir- culated at the same time I do not propose to deal with those estimates at any great length.
"I fear that the innovation, for which I was responsible, of permit- ting the Press to see the printed es- timates with the Council's Order of Business has led some of the papers to mis-interpret them, and the state- ment of Government's full proposals may be disappointing to those who read some of the more sensational deductions published yesterday after- noon. The Press have also given, due prominence to one fact shown by the print, that is that we already have the forty million budget which I spoke of as a possibility of the more distant future twelve months ago.
13/15/39
"Expenditure and, fortunately, re- venue as well have continued to in- crease automatically with the in- crease of population. On a peace basis an approximate balance was expected but the war is likely to in- crease expenditure in many direc- tions without correspondingly in- creasing revenue from existing
sources.
No Innovations
"The estimates as printed contain no innovations in revenue apart from the re-arrangement of the heads in more convenient form. As to ex- penditure the procedure of examina- tion by a select committee of this Council which will be followed this vear as before will afford full op- portunity for honourable members to make any comments which they de- sire and elucidate any obscurities in the details. Those details were mainly settled before the outbreak of war but no necessity is seen at pre- sent to alter them at all considerably.
war
mea-
"In preparing the final draft, a number of items of new expenditure which it had originally been desired to include were deleted in order to avoid budgeting for any substantial deficit in the uncertain circumstances which lie before us; but the Govern- ment have very definitely refrained from economising at the expense
of either of social services or sures of economic development. Your Excellency has made clear that there is no intention to curtail those services in order to provide funds for the new calls which the
must make upon our resources.
"I venture indeed to say that, large as the expenditure must appear, all of it is either essential or extremely the desirable in order to maintain public services of this Colony and to enable the Government to discharge its obligations to the community.
"Honourable members will find that much of the increase in recurrent in- charges is directly due to our creased population, e.g. the increases in the Police and Sanitary Depart- ments.
Essential Works
"The programme of Public works Extraordinary includes many items of a capital nature which are essen- tial to carry on the economic develop- ment of the Colony. Evidence of the intention to continue the develop- ment of social services is given by the provision for the commencement of a new Queen's College, a new In- fectious Diseases Hospital and new Health Centres, as well as a new Volunteer Headquarters.
"The actual amounts expected to be spent on any of those buildings next year are small but their in- clusion will give approval for pro- ceeding definitely with plans for them and concluding a contract for the work.
"Nonetheless we must not be wholly unprepared for financial difficulties and the programme of public works extraordinary and also the many items of special expendi-
ture appearing in the individual heads of estimates, although they may be approved by this Council and the Secretary of State, will not be automatically carried out if the re- venue position does not justify the expenditure. All such items require the individual authority of Govern- ment before expenditure is incurred on them and that approval will be withheld if necessary.
"In addition it is proposed to draw up a schedule of additional posts provided for in the estimates the filling of which will similarly be subject to special approval. That procedure will enable Government to proceed with these appointments if the financial position does not deter- iorate but ensures a continuous con- trol in the light of current financial circumstances.
47
Continued