ENG-1963 — Page 91

PUBLIC FINANCES

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fallen. Thus the figure of 82 per cent mentioned for 1959-60 fell in 1960-1 to 74 per cent (the estimate was 88 per cent), to 69 per cent (against an estimated 80 per cent) in 1961-2 and to 68 per cent (against an estimated 78 per cent) in 1962-3. These varia- tions were due mainly to an upsurge in recurrent revenue arising from the very active trading conditions which have prevailed in the Colony. At the same time capital expenditure, though rising substantially, was rather lower than originally forecast, and capital revenue, mainly from land sales, showed a marked increase.

A comparative statement of recurrent and capital income and expenditure for the years 1959-60 (actual) to 1963-4 (estimated) is included in Appendix II. It will be seen that a deficit of nearly $163 million is estimated for 1963-4, indicating that revenue will no longer be able to finance all capital expenditure. Such expendi- ture arises from Government's very heavy programme of non- recurrent Public Works, mainly for more schools, medical facilities and housing as well as for water supplies, roads and land develop- ment schemes. The estimated deficit may well prove to be pessi- mistic but, even so, the possibility exists that money will have to be raised in succeeding years by loans and additional taxation if development in these fields is not to be curbed.

The Colony's statement of assets and liabilities at 31st March 1963 and analyses of the Colony's revenue and expenditure in the financial years 1961-2 and 1962-3, together with the estimates for 1963-4, are at Appendix II. In 1962-3 the revenue of $1,253 million was $191 million more than the original estimate. The largest excess was under land' sales ($102 million) but most of the recurrent heads also recorded excesses; of the latter internal revenue with $22 million (including $9 million on earnings and profits tax and $8 million on estate duty), revenue from lands, interests, rents, with $16 million (including $12 million from interest) and Post Office with $15 million were the largest. Expendi- ture for the year was $1,113 million against the estimate of $1,226 million, a saving of $113 million of which $60 million on public works non-recurrent arose from certain projects not progressing as fast as expected.

The statement of assets and liabilities shows that at 31st March 1963 net available public assets were $797 million, of which $138 million was earmarked in a Revenue Equalization Fund as a