my Ministers have continued to give active support to the technical
assistance programmes of the United Nations and to the Colombo
Plan for the economic development of South and South-east Asia.
In this way we are demonstrating our sympathy and concern for the
peoples of the new nations of Asia and our sense of Commonwealth
partnership.

Accompanied by my wife and daughter, I have recently enjoyed
the privilege of visiting the island territories for whose administration
the New Zealand Government is responsible. We were able to
meet the leaders of the Samoan and Cook Islands peoples, and I
would like to take this opportunity of expressing our appreciation
of the welcome and hospitality we received at all stages of our
journey.

Last year my Prime Minister announced important proposals for
the political, economic, and social development of the Trust Territory
of Western Samoa. In pursuance of these proposals a constitutional
convention representative of all the people of Samoa is to be held at
Apia during the present year for the purpose of discussing the nature
of the political institutions they would wish to see established when
the Territory achieves full self-government.

The well-being of the people of the Cook Islands, Niue, and the
Tokelau Islands has continued to receive the attention of my
Government. Special heed has been paid to questions affecting
their political institutions as well as their economic and social
advancement.

New Zealand's own economy has remained healthy and vigorous
during the past year. There has been a steady demand from
overseas for our primary produce at prices which have enabled us
to maintain the buoyancy of our external trade. Budgetary prospects
for the past financial year were affected by the general wage increase
granted from 15 September 1953. Basic social security benefits and
war pensions were substantially increased to offset any rise in living
costs resulting from the wage increase. The revenues have been
sufficiently buoyant, however, to meet the heavy costs of our defence
programme, to sustain the taxation concessions made again last year,
and, after absorbing increased wage costs, to yield a small but
satisfactory surplus of £1,800,000 in the Consolidated Fund.

Steady progress has been made with the extensive programme of
works essential to the development of our resources and the maintenance
of present living standards for a rapidly increasing population. To
provide finance for these projects two internal loans were floated
successfully, and additional monies were secured from a loan issued in
London. These were supplemented by a loan from the trading banks
for housing purposes.

Because of the unbalanced seasonal conditions during the year,
pastoral and dairy production has been below normal. However, all
classes of livestock have increased in numbers and total production
has not been seriously affected.

The determination of the United Kingdom Government to put an
end to rationing, price controls, and bulk purchase arrangements for
major food items has a considerable bearing on the marketing of our
primary products. New Zealand foodstuffs will once more have to face
open competition in the markets of the world, but, on the basis of
quality and service, will be able to hold their own if given fair
competitive conditions. Open trading conditions will, however, give
rise to some difficulty in the forward assessment of our national revenues,
and every effort must be made to increase the volume and improve the
quality of our primary products on which the prosperity of this country
so vitally depends. Attention is therefore being paid to land and pasture
improvement, whilst aerial topdressing of hill country is being
expanded.