THE NEW ZEALAND GAZETTE.

[No. 61

utmost importance to the recent Conference at Lausanne, and they have
followed its deliberations with deep interest, as calculated to enhance con-
fidence and promote commercial intercourse. Complete success, in their
opinion, must depend upon international co-operation, and my Ministers
hope that a substantial measure of progress will be achieved by the World
Economic Conference which is now contemplated.

My Ministers have continued their whole-hearted support of the League
of Nations and of the principles of permanent world peace which it is its
object to promote. They have been represented by their High Commissioner
at the Disarmament Conference, which has been sitting at Geneva during
the current year, and it is their earnest hope that when the Conference
reassembles it will be able to effect a material reduction in international
armaments.

MR. SPEAKER AND GENTLEMEN OF THE HOUSE OF REPRESENTATIVES,

Owing largely to the prices of primary products in the world's markets
continuing to fall during the past financial year, the disorganization of our
economic life has been accentuated to such an extent that the Government
felt it necessary to submit drastic proposals to meet the situation. More
adequate provision to relieve unemployment was found to be essential,
despite the fact that the cost of providing this relief increased the heavy
burdens already pressing upon the people. So extensive a fall in prices
altered all previous standards of values, and its suddenness and rapidity
caused many borrowers serious embarrassment. The legislation passed
during your special session to enable them to maintain production and in
order to spread the financial burden as equitably as possible over all
sections of the community has afforded considerable relief.

The stagnation in trade and industry was inevitably reflected in the public
finances, and, notwithstanding additional taxation, reductions in salaries and
wages, and other economies, the efforts of my Ministers to balance the Budget
were unsuccessful, and the financial year closed with a deficit of £2,140,000.
It is gratifying to note, however, that this amount is more than offset
by reserves accumulated in more prosperous times.

The National Expenditure Commission, which was appointed to assist
in effecting further economies in State expenditure consequent upon the
reduced revenue, has now submitted its final report. Many of its recommenda-
tions have already been carried out, and legislation will be submitted to give
effect to others the adoption of which is considered desirable.

In spite of prevalent adverse conditions, a loan of £5,000,000 was success-
fully floated in London in April. Of this amount, £4,000,000 was allocated to
the redemption of short-term loans, and the remainder to public works.

My Ministers are of opinion that the Conferences at Lausanne and
Ottawa, together with the large conversion loan successfully negotiated in
Great Britain, have inspired a healthy and promising return of confidence.
Improved trade conditions will result in better prices for the Dominion’s
products in external markets, and the national income, thus augmented, will
benefit all classes of our people.

Renewed activity in business will aid materially in accelerating economic
equilibrium, and my Ministers are anxious not to discourage enterprise by
imposing upon the community any further burden. Although the budgetary
position still demands anxious consideration, every effort is being made to avoid
the necessity for any increase in taxation during the current financial year.
As a measure of relief, my Ministers recently decided to restore the system
of penny postage.

HONOURABLE GENTLEMEN OF THE LEGISLATIVE COUNCIL, AND GENTLEMEN OF
THE HOUSE OF REPRESENTATIVES.

In common with other sections of the farming community, Crown settlers
have been adversely affected by economic conditions, and in many cases it
has been necessary to grant liberal concessions in order to ensure the