Even today permission from the Niue Cabinet is required for Sunday work The only tim e the Niueans have regularly worked on a Sunday was during the Second World War at a tim e of

In document Aid in an island microstate : the case of Niue (Page 88-90)

2 0 0 0 1 0 0 0 financial contributions 10 1 9 3 0 1 9 4 0 1 9 5 0 1 9 6 0 19 7 0 Y E A R

F i g u r e 4 -5 : New Z ea lan d fin a n c ia l c o n tr ib u tio n s to N iu e , 1930-1973 (c o n s ta n t 1965 va lu e s ). Source: A p p e n d ix 4.4.

1

Z ea la n d G o v e rn m e n t p ro v id e d th e N iu e A d m in is tr a tio n w it h fin a n c ia l assistance. B e fo re 1948, th is fin a n c ia l assistance was r e la tiv e ly s m a ll ( A p p e n d ix 4 .4 ). In th e f ir s t th re e decades o f th e c o lo n ia l p e rio d th e a n n u a l su b s id y a veraged 20 per ce nt o f lo c a l reve nu e, 40 per c e n t betw een 1930-1934 and 55 per ce n t b etw e en 1940-1947. T h e N ew Z e a la n d G o v e rn m e n t a d v o c a te d th a t econ om ic d e v e lo p m e n t sh o u ld be fin a n ce d o u t o f lo c a l revenue, w h ic h lim ite d New Z e a la n d ’s r e s p o n s ib ility to th e p a y m e n t o f p u b lic service sa la rie s and a d m in is tr a tio n . T h e su bsidie s w ere a llo c a te d a lm o s t w h o lly w it h in th e n o n -p ro d u c tiv e s e c to r o f th e e co n o m y, e s p e cia lly on e d u c a tio n a l and m e d ica l services ( T a b le 4 .1 ). T h e p o lic y stressed social w e lfa re a t th e expense o f e co n o m ic d e v e lo p m e n t. T h e f ir s t g o v e rn m e n t school was opened in 1909 and a h o s p ita l in 1922, b u t i t w as n o t

7. B e tw e e n 1901 an d 1961 th e a n n u a l fin a n c ia l c o n t r ib u t io n fr o m N e w Z e a la n d was k n o w n as a ’’ s u b s id y ” a n d be tw ee n 1962 a n d 1973 as a ” g r a n t - in - a id ” . T h e N iu e A d m in is t r a t io n v o lu n te e r e d n o t to c a ll up o n N e w Z e a la n d s u b s id ie s b e tw ee n 1935 an d 1939, u n lik e th e C o o k Is la n d s w h ic h c o n tin u e d to rece ive an a n n u a l s u b s id y d u r in g th e sam e yea rs.

until 1954 t h a t a D e p a rtm en t of Agriculture was established and 1967 t h a t an economic development plan (Neill, 1967) was implemented.® All this was far too late to arrest the general decline in the export economy. In broad term s the policy could be term ed "social welfare colonialism". The New Zealand Governm ent also subsidised the Niue Adm inistration in indirect ways. In 1920, for example, it was paying over £4,000 in e x p a tria te salaries and subsidising a schooner service by up to £2,200 per year.

T a b le 4-1: Percentage breakdown of New Zealand subsidies by purpose, 1930-1934 F i n a n c i a l y e a r E d u c a t i o n M e d i c a l R e s i d e n t C o m m i s s i o n e r ’s D e p a r t m e n t S h i p p i n g l i g h t s 1 9 3 0 - 3 1 3 6 35 27 2 1 9 3 1 - 3 2 3 5 3 4 28 3 1 9 3 2 - 3 3 41 59 - - 1 9 3 3 - 3 4 41 5 9 - - 1 9 3 4 - 3 5 4 4 5 6

Sources: N Z P P A-3 for 1930-1932 and N Z P P A-6 for 1933-1934.

The formula by which the subsidy was calculated entailed deducting estim ated local revenue from estim ated revenue for the year ahead and covering the shortfall with a subsidy set a t the previous y ear’s level with a small increment for inflation. This formula was changed in 1948 when in addition to an ordinary subsidy, the New Zealand Governm ent introduced a subsidy for capital development. The A dm inistration embarked on a four year development program m e to build new schools, improve port facilities, roads and housing a t a cost of £69,000. As many of the m aterials required for these projects could not be obtained locally, they were imported from New Zealand thus disturbing Niue’s trade balance further. The New Zealand G overnm ent also allocated increased funds for improvements to social and ad m in istrativ e services including the paid employment of ex tra staff. The total subsidy allocated in 1948 was £32,257 or more than four times the am ount given in 1947 in real term s (Figure 4.5).

The introduction of a capital works program m e for Niue and the sudden increase in New Zealand financial assistance marked the transition from self-support to

8. In contrast, a Departm ent of Agriculture was established in the Cook Islands in 1906, despite

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