DEMANDS OF THE SECOND DIVISION LEAGUE

Dominion, Volume 11, Issue 4, 29 September 1917, Page 6

DEMANDS OF THE SECOND DIVISION LEAGUE

The sfcand-and-dclivcr attitude recently adopted by it section pE the representatives of tho Second' Division League who have been meeting in conference in Wellington is morelikely to alienate than to win support for tho claims they havo advanced. There was far too much wild talk at yesterday's meeting of tho league delegates, and the good case which tho Second Division men unquestionably have is liable to bo .discounted thereby. The protest made against tho attitude adopted by ' tho Minister of Finance, and supported.by'his colleagues, is,, wo believe,-fuljy justified. The Government is quite -right in exercising a proper caution regarding the financial commitments which it imposes on' the country. Sir Joseph Warh plainly feels the heavy burden oE responsibility which rests on his shoulders, and. his speech on Thursday evening indicated a degree of alarm at tho prospect of adding further to the cost of pensions and allowances that, cannot be lightly ignored. But when this is conceded, it is still open to question whctlwr the Government is. viewing this vitally important' matter from the proper point of view, and whether it is not over-stating the difficulties and dangers ahead and underrating tho obligations of the country to the men who are called on to. make- the sacrifices entailed by compulsory service. Sir JOSEPH WARD, the Prime Minister, and .the Minister • of .Defence, each in turn, have emphasised the enormous strain w'hich will be placed on the finances of the country and- on the .people of the Dominion if any increase is made in tlic scale of allowances brought down by the Government, bin Joseph Ward stated that -no increases could possibly be made without adding increased taxation this session. The cry was also raised by one of the Ministers that they had to bear in mind.that if they placed the pensions on a too liberal kale tho country might at some future time repudiate this liability. » Now, what are *thc actual facts < The total cost of the pensions as proposed under the BiU, according to the Government, will be twelve months hence £1,063,000 annually— 'a'little- more than double tho cost o£ our old-age ' pensions. During the current financial year it will not be anything like that amount. Why then, tho anxiety concerning the taxation proposals which cover this year's finance? That, however, is a minor point. ' It is only of imindicating the tendency of Ministers to strain the facts in order to support their, case, lne chief ground of complaint, however, is in respect of the allowances to dependants of the men called on for military service during the absence abroad of tho husband and father. It is estimated that under the proposals of the Government these ■ „. twelve months from January next will amount to a little ovci £2 000,000 a year. The attitude of tho Government would lead one to belkvcthat this sum comes out of revenue, ' and it might even be thought by many that it was a permanent liability. As a matter o fact, allowances are paid out ot

loan money, they will cease with the return of the soldier at the close of the war, and the only charge on the revenue- of the country is the Interest charge on the loan money. Thus tho bogey of extra taxation being necessary at once to meet any addition that might bo made to the scale of allowances is-'simplc humbug. While on this question of ivenuo and taxation, it is worth while to direct tho attention of members of Parliament to tho Budgets of 1916 and 1917. It will be seen that in 1916 the Finance Minister estimated the revenue for 1916-17 at £14,591,401. He actually received £18,367,547, or over three and a half millions more than he estimated. 'This year "he has estimated his revenue for 1917-18. at £17,282,000; that is to say, at one million less than last year, and it is on this very conservative estimate that he bases his alarm at the prospect of any interference with his finance. It is true that Customs and 'Railways revenue are. likely to show a shrinkage, and there will bo some loss of revenue from the early closing of hotels, but these losses "will he much more than compensated for by the. heavy increase in land and income tax revenue. In the light of last year's receipts, the estimated yield from land and income taxes under the new scales of taxation plainly is greatly understated. 'So it is that while the Finance Minister may not have under-estimated his revenue this year to the same extent as last year, when it exceeded the estimate by 3i millions, it is plain that he has again erred on the side of caution, and that the actual yield will be much in advance of his estimate. •The position, then, so far as the 'financial side of the.question is concerned, may be briefly summarised as follows:-(1) .The.total cost of. pensions which must be. met out of taxation will be 12 months hence not more than a little over.one million per annum. (2) The total cost of allowances which. are met out of loan money will be 12 months hence a little over two millions.This is not a permanent charg'.y (3) The Finance Minister's estimate of current year's revenue, taking as a guide last year's figures, and allowing for certain lossesof revenue, is plainly an under-estimate. ;(4) The claim of the Government "that the demand of the Second Division for increased allowances will necessitate increased - taxation this- year clearly is unfounded. These'facts, we submit, answer the chief objections raised by Ministers on financial grounds to increasing the allowances to the wives and children of the men called on for military service. The permanent charge involved is undoubtedly a heavy one ; but it is not so heavy, as has been implied, and does not involve the necessity for any furthe^ 1 h6avy increase of taxation at the present time. Nor does it necessarily involve y .any further heavy increase in the near future. The Government had no qualms about giving away £400,000 of the taxpayers' money this year as a bonus to wellpaid Civil Servants; it surely has greater reason to strain every .effort to provide'adequately for the families of the men who are called on not only to risk their lives but to sacrifice their businesses, their positions, ,and their incomes to serve their 'country. When tho regulations providing for the allowances ,to the dependants of men on _ military service como up for consideration we trust that tho attitude of members will leave the Government no excuse for failing to improve them. >