Report of the British Economic Mission to Australia

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Monograph

Identifikator:: 179824683X

URN:: urn:nbn:de:zbw-retromon-182286

Document type:: Monograph

Title:: Report of the British Economic Mission to Australia

Place of publication:: London

Publisher:: His Majesty's Stationery Office

Year of publication:: 7th January 1929

Scope:: 63 S.

Digitisation:: 2022

Collection:: Economics Books

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Document type:: Monograph

Structure type:: Chapter

Title:: Part II. Main problems

Collection:: Economics Books

damaged Australian credit, but in our judgment the mere mag- nitude of the debt is not in itself evidence of an unwise borrowing policy. 11. In a new country, still largely undeveloped, where the recognized scope of the activities of Governments is as wide as it ls in Australia, it may be quite proper that large sums of capital for development should be raised by means of public loans; but It is essential that the development schemes, financed by means of them, should be self-supporting within a reasonable measure of time, which we recognize may be longer in the case of a Govern- ment than in the case of a private undertaking. By this we mean that within such measure of time they should, either directly, or indirectly through the increased taxable capacity of the com- munity and the enhanced value and price of Government-owned land attributable to them, provide at least their own working costs, interest on the loan capital invested in them, and a sinking fund sufficient to provide for its repayment when it falls due. To the extent to which they fail to do so they involve the State im loss, and to the extent of that loss inflation takes place, the dead weight burden of debt on the State is increased and the rest of the community are, in effect, paying to the persons served by them a subsidy which will be reflected in a general increase in the costs of living and production. We are led to the conclusion that the Australian community is suffering heavily from troubles of this kind. 12. According to figures with which the Treasurer of the Commonwealth has been good enough to furnish us, the respective positions of the Commonwealth and of the States as regards their indebtedness at the 30th June, 1922, and at the 30th June, 1998, were as shown in the following tables *—— In Australia| Overseas Total Per head of Population. 30th June, 1922— Commonwealth Debt... States’ Debt ... ... Total ... ves x 250,000,000 299.000.000 £L 115,000,000 297.000.000 £ 365,000,000* 519.000.0000 £ 66 93 172.000.000 £12 000 000 R84 000.000 159 30th June, 1928— Commonwealth Debt... States’ Debt ,., .. Total ... van 219,000,000 339'000.000 53,000,000 391 000.000 372,000,000* 793.000.000 59 {15 551.000.000 | 544.000.000 295.000.0000 174 Objects of Australian borrowing. Comparison >f the position of the Common- wealthand of ihe States as regards public debt. Exclusive of loans raised for the States. 13. Of the total Commonwealth debt at the 30th June, 1928, £293,000,000 was deadweight War Debt and £79,000,000 was for works such as Post Office works, Commonwealth Railways and +499 AA

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