NEW ZEALAND'S PROBLEMS.

Press, Volume LXVI, Issue 20107, 10 December 1930, Page 15

NEW ZEALAND'S PROBLEMS.

POLITICAL ADDRESS. MR D. JONES AT METHVEN. UNITED GOVERNMENT ATTACKED. Reviewing the political and economic situation of New Zealand, Mr IJavid Jones, M.l'., in a public address at the Mcthven Town liall last, evening, urged that the problems now facing the Dominion were not being dealt with soundly by the United Government. Condemning particularly tho Party's extravagant policy of borrowing and spending and its unfulfilled election promises, Mr Jones went on to criticise the railways construction programme, the increases in taxation, the growth of unemployment, and, finally, the "blanketing ' of tariffs in place of protection for deserving industries. Mr Jones held that such restrictions as were imposed by the Arbitration Court should be removed, lie gave special attention to the prob lem of the farmer who, while receiving 12 per cent, more than pre-war prices for his produce, had to pay 03 per cent, more for his purchases. Unless those percentages were equalised, lie said, disaster would surely come. The Methven Town Hall was filled by a crowd of about 200 people, and Mr Jones was most attentively heard. After some questions at the end of iu a address, a vote of thanks and confidence in hnn as the member for tho district was earned unanimously. introducing .Mr Jones, Mr F. \\ . liuddenklau said that ho was well known to ail in the district. Mr Jone 3 would undoubtedly give a good instant into tho political problems oi tliu day. Promises Unfulfilled. Mr Jones welcomed Ills audience, expressing liis pleasure that it was so large m the '"oH" season. At the last election theiv was a turn-over in Parties, and the cry went round that New Zealand wanted a change. New Zealand got it. The.y would remember something ot what promises were b.y the United Party—promises ol £70,000,000 at low rates of interest, big drops in taxation, and many other things. The Party promised New Zealand Heaven, and New Zealand got ; • New Zealand lell down and worshipped the golden imago and had now had tho opportunity of two years' trial. Neither the Loader ot the Reform Partv nor the Party had failed the people of New Zealand, although this failure was charged against them. In the 16 years they hold ofiice, there was an unparalleled increase in production While the exports were £21,000,000 when tho Party came into power, they were £57.000,000 when it went out. New Zealand had then become the greatest exporter of mutton and lamb in tho world. Such was the remarkable development of New Zealand during tho Party's regime. Difficult Times Realised. As for farming finance, during the strenuous times of 1921, 1922, and 1923 tho farming industry was greatly assisted Tho Rural Finance Act was recognised as one of tho most important enactments, and when the t'arty went out of power, ihc Housing Act was solved through the deliberation of Mr Massey and Mr Coates. Tho Dominion's credit was tho highest m tho world when the Party left oilice. In no country of the world was a system of sound finance better understood. Two years before the last election, Reform saw that difficult times were coming, and realised the necessity of steadying the borrowing policy. Because the Party did this and refused to bring before the people a wild programme of expenditure, it went out ot office Now, however, it was realised that Reform was right and United, with all its lavish promises, wrong. "The Moneylenders' Government." Tho present Government might be fairly called the moneylenders' Government. Because of election promises, railway expenditure was at its highest peak, and the railways iti their worst position. None of tho promises of reduced taxation had eomo true. Tho Leader of the Reform Party, he emphasised, stood clearly abovo tho leaders of the other Parties. Mr Coates had never stood tip in tho House without expressing his willingness to put New Zealand first. His Party supported him solidly. Unemployment Problem. The unemployment situation presented a most acute problem. United and Labour agreed on 14s a day for relief wages, but Keform held that a lower rate should be paid in order not to induce people to leave their present occupations. Yet, under this policy, they had been leaving their occupations. When the United Party promised work for every unemployed man in five weeks, they began to come forward in hundreds and in thousands. That was one of the most unfortunate promises in the United Party's policy. Both by this Government and the Government that followed it, the position would take a lot of cleaning up. At the time of the French Revolution the Socialist Party made a precisely similar offer of work for all. Expenses mounted, costs increased, until in the end the whole financial and political system broke down in the revolution. To-day between 19,000 and 20,000 men were on various public works besides manv others still crying for work. That was "a load that could not be long carried. Public expenditure was going up and up, and with the present price of primary products, the break must inevitably come. "The Facts Must he Faced." "These arc not pleasant words, but' the facts must be faced," continued Mr Jones. "Tho burden can't be carried and the breaking point is bound to come. Instead of going out to meet it, the United Party is waiting for it to fall." When Mr Forbes came into office, the Treasury prepared a full statement, pointing out to him that New Zealand was heading for disaster. Mr Forbes gave that out to the country, promising to effect economies and balance the Budget. But he fell down at the first hurdle and criticism began, and the Party's economy campaign disappeared. He found the remedy in the easy way of piling on the taxation. Reform pointed out that the Government could not increase taxation and estimate returns unless the community was exceedingly prosperous; in other words, that their money would not be there. The totalisator tax, for instance, had fallen to its own level. After expecting to balance the Budget with £250,000, the Party was now in a worse position than ever. Mr Forbes had his opportunity and missed it. Yet he carried on borrowing and spending while the country's exports droj>ped by millions.

Tlie Borrowing Policy. lolf stat , ed th at if. was impossible to ;; r ~olT° w £70,000,000 at 4-} per v»rr i c ? nt -^ n uod Mr Jones. "And it lias Proved impossible. The Government's >'n .it 5J per cent, has been on the niirkot ever since. The Government cu a t 51 per cent, what the ■ •in teis niul business men ■wanted. Ami 'nw I' l omiscd it to you ;it 4"; per cent." J-lie expenditure in the last complete iinn'i tho Rc ' J '°"» Part v was ii >2,000. ■ uuu less than that in the first year of ic Lnited Party. In times ot ? stress, si"-" a sum meaut a great deal. Tlic revenue through increased taxation U P ''y £3,030,000, adding tho post, o ice figures which were inciuded ill the iirst total. Increase in Taxation. In the United Party's lirst venr t.ixat'on increased by over £2,ooo',oo<\ They Vrt> lc, ' l !' o . j tliat t,10 .v " ere still in serious "iriiciiltics in finance. Increased taxation would therefore be inevitable when the next Budget was framed. United made a blanket" Customs fax on the bulk of what had been previously taxed. In Beionn s last vonr the uct borrov ins was -0,500,000. If the present Government continued in office it would take that amount for taxation alone and a similar amount for borrowing in addition. Tlie country could not carry such, burdens: they were already more than the country could bear. Tn its first year United borrowed £ 11,500,000 and it seemed that this total would be exceeded in the current year. Railways Construction, As for the railways, in the last three years of Reform the railways paid 3.O'J per cent., and in tlie first complete year of the United Party, 1.61 per cent. "The Party, through Mr Coates, a most ablo Minister for Railways, was handling the railways as well as they could be handled. Last year the railways lost more than the land tax for the whole country. In spite of that the present Government continued to build railways. Tlie loss on the lines which the Government was going to construct was estimated at £.732,000 annually. Mr Jones described some of the deliberations of the Parliamentary Committee set up to consider the railways under construction. With motor transport making such strides, was any railway construction at present justified? The Government was going to spend between £2,000,000 and £3,000,000 on completing the South Island Main Trunk when a bitumen road could be laid down for £240,000 and the railway line was likely to bo closed as soon as it was opened. Money was being put into railways to-day without justification. These were unpleasant facts, but now more than at any time they had to be stated and faced. What had tho United Government done with the highways funds. Reform brought in the Highways Act, bringing ill tho Highways Board, the petrol tax, and motor taxation. Certain definite regulations were laid down under which the Government was to pay the Highways Uoard £200,000 to take over the roads. This session the present Government withdrew the £200,000 and left the whole of the highways on the Board's hands; it did worse, it charged the Board interest on all the money it had received during tho last six years. The Government went further, refusing to pay local body subsidies. Altogether the Government took £510,000 from the highways and put it into the public revenue. Then the Government said: "Wo will charge you an extra 2d in petrol tax and {five >' ou that." An additional burden of £516,000 was put on the rates and petrol taxation. Problems of Economics. "The main problem confronting New Zealand is an economic problem: it's a question of cash," said Mr Jones. "Is the Government prepared to meet it? In the last days of the House I made the strongest and bitterest speech I have ever made, pointing out to the Government the serious position of farmers. What did I get? I got a bitter attack from the Acting-Prime Minister for being pessimistic. We suggested that at the very least a conference of all interests should be called together to examine the position. All we wanted was the facts. The request was refused, and we were accused of attacking tho Government." .Reform asked that power of action should be given to the Arbitration Court. That request, too, was refused. liel'orm had made many constructive requests and suggestions. All it had received, except in one case, was a slap in tho face. There were differences of opinion all along tho line. Unless the United Party repented, fusion was impossible. Primary Producers' Plight. What was the position of the primary producer to-day? To-day the farmer was paying G3 per cent, above pro-war prices, while the returns for his produce were less than 12 per cent, above pro-war. Until those percentages svere equalised, the farmer was facing a most serious position. There was no easy remedy. The Reform Party had spent too much in its early years, everyone had. To-day there was a great cry for a moratorium to prevent « man from being sold up because ho was unable to meet his interest and liabilities. No one would call up money to-day if he was getting interest; and a moratorium would not assist those who were not getting their interest. Mr Jones asserted that from a farmer's point of view a moratorium would not be valuable, r.nd might be harmful. Tho Government deserved great sympathy in connexion with unemployment. The function of the Government should have been long ago to put tlio men into productive instead of unproductive vforks. What had tlio Government done in two years? They had boon waiting for a long time for tlie Unemployment Board, and even now the Government was not shouldering its full responsibilities. The increases in tariff, instead of being a "blanket," should have been carefully thought out to prefect tho deserving industries Almost every country in tho world was putting up trade barriers. Ho believed that New Zealand .-hould do more to protect its industries and make the country self-contained New Zealand had to begin to find work for its own men more than before. If revenue was needed, was it not better to develop some valuable industries rather than to put a protective blanket over the whole. Implement factories in New Zealand were closed two or three days a week, while farmers bought their machinery frcm a country that was closed largely to New Zealand goods. In the United States between 1920 and 1925, 9,500,000 acres of land had gone out of cultivation because of the passing of tho horse. Perhaps in New Zealand the time would come when it would be valuable for the farmers to use horses again. Reduction of Wages. Summing up, Mr Jones urged that, in employment restrictions should be removed to give freer play. There was a cry to reduce wages; but wages had been reduced during the last two years. After all, it was the annual income, not the daily income, that mattered. Many men would prefer to have less per day and to work more days in the year. If there was going to be a sacrifice in New Zealand, there should be no objection to it being a general one. To help manufacturers and help tlie country out of its difficulties, a host of restrictions must be removed. The gulf between the 63 per cent, and the 12 per cent, made the farmer's position impossible, and the farmer had as much right to a living wage as anyone else. Mr Jones mentioned the Canadian Debt Adjustment Act, which he thought might profitably be introduced in New Zea-

land. Some advocated borrowing as tlie remedy for present troubles; but borrowing meant ultimate repayment and an increasing rate of exchange. The Arbitration Court. Questioned by Mr James Carr as to whether lie thought tho secondary industries could prosper under tho present Arbitration Court. Mr Jones said ho believed in compulsory conciliation and voluntary arbitration as in Canada. Without any arbitration, tho workers of the United States were earning princely wages, and running New Zealand's workers out of employment. On tho question of derating farm lands. Mr Jones replied that the Government had reversed Reform's policy, and, putting into tho coffers of the Stato the money for highways, thereby increasing rates, had largely destroyed that policy. Questioned about the salary of Mr TI 11. Sterling, general manager of Railways. Mr .Tones emphasised that to-day. although a sound man ho was not given anv authority to manaire bv (ho United Government. The Reform Party supported a board of management. for anv person running any business should have full and proper control. The same questioner complained of the wicked waste of money in giving all school teachers thirteen weeks' holiday each year. "Did you write to the United Party about it?" retaliated Mr Jones. Mr Jones said he was not in favour of the amalgamation of the Meat and Honey Boards. There was very little similarity between the work of the two, and each could carry on most effectively by itself. Thanks and Confidence. A motion of thanks and confidence in Mr Jone.s was moved by Mr J. KDalton and carried with acclamation. Mr Jones, he said, was a statesman and a worthy representative of the district. (Applause.) They had been pleased to hear his speech and hoped that at an early date there would be another election The country needed one Party with a working majority, and not three Parties. Mr Hugh Ledger wood seconded the motion.