In presenting the annual review of the public finances of Newfoundland, I propose to follow the accepted practice by dividing the statement into three parts. The first will deal with the financial results of the fiscal year which ended on 30th June, 1932; and the second with the expected results of the year now about to close. The third part will consist of the budget for the fiscal year from 1st July, 1933, to 30th June, 1934.

  Before, however, entering upon my detailed statement, I would like to refer for a moment to the existing economic situation, particularly as it affects this Dominion. No improvement has become visible during the past year in the abnormal, and unprecedented, financial and economic conditions which showed themselves first some years ago, and have since extended over nearly every country in the world. It is true that some slight and hesitant return of business confidence was to be observed during the summer and early fall of 1932. But the movement was short-lived, and in the year as a whole there has occurred a further general decrease in commodity prices and a continued diminution in business activity and in employment; accompanied in some countries by acute financial and banking difficulties which are not likely to facilitate the task of reconstruction. For Newfoundland in particular the renewed decrease in the price of codfish, in the price of newsprint, and in the export of iron ore, combined with adverse exchange conditions, has inevitably had its indirect effect on our Customs revenue which, as is well known, forms the great proportion of the total revenue of the Dominion; while the payments of interest upon loans raised at very high rates in the past, which are out of all proportion to the existing price of money, has subjected the finances of the Dominion to an intolerable strain.

  I turn now to the first part of my financial statement, namely, revenue and expenditure for the year which ended on 30th June, 1932; and I will compare the estimated revenue and expenditure with the actual results for the year.

  The Estimates which were laid before this House at the beginning of the year 1931-32 show the following totals:--

  The actual results, however, are given in the following figures:--

  The failure of revenue to reach the budgetary estimate was due to the fact that Customs receipts amounted only to $5,787,051 as compared with the estimate of $7,750,000. These receipts were less by $1,678,000 than the Customs receipts in the preceding year.

  In regard to expenditure, the estimates included no provision for able-bodied relief, and, although they were reduced by some $670,000 in the course of the year, partly by savings effected in the various Departments as a result of an Act which reduced most of the Votes by 10 per cent., and partly by additional economies in the first stages of the financial reorganisation during the fall of 1931, expenditure during the year of $1,170,000 upon able-bodied relief produced an excess expenditure of nearly $500,000, as I have shown.

  The deficit for the year was accordingly $4,029,339.22. Further details will be available in the tables which will be appended to the printed Budget Speech.

  The figures of expenditure, however, which I have just given, cover current expenditure only; that is to say, they do not include items charged to the Capital Account. Expenditure on Capital Account amounted to $1,675,892.56. This capital expenditure included sums of $600,000 to meet the deficit on the management of the Railway for the year 1930-31, of $221,141 for Railway capital expenditure, of $488,661 for redemption of the Newfoundland Hotel Facilities bonds; together with $152,581 as a loan to the Newfoundland Savings Bank, which has since been repaid.

  The total expenditure of the Dominion for the year ending 30th June, 1932 was, accordingly, $13,636,279.19.

  Apart from borrowing on behalf of the Railway and the Newfoundland Hotel, it was necessary for the then Government, in order to meet the interest on the public debt during the year, to borrow the sum of $2,200,000 from the syndicate of Canadian Banks composed of the Bank of Montreal, The Royal Bank of Canada, the Canadian Bank of Commerce, and the Bank of Nova Scotia; and, in addition to this, to raise a loan of $2,500,000, the interest and sinking fund of which are secured by an annual payment by the Imperial Oil Limited in return for a monopoly in the importation of gasoline and other petroleum products.

  There was, in addition, during the year 1931-32, a deficit of $339,000 on the Railway administration for meeting which no provision was made.