LABOUR'S VIEW

Evening Post, Issue 37, 12 August 1936, Page 14

LABOUR'S VIEW

MR. HAMILTON CRITICAL

IDLENESS AND WORK

Mr. Hamilton said that the speech of the Prime Minister (the Rt. Hon. M. J. Savage) had been rather disappointing. He should have risen to the occasion and shown the mastermind that was controlling the country. The speaker sometimes wondered whether Mr. Savage's was the mastermind.

The Prime Minister, continued Mr. Hamilton, had declared that what they needed was a redistribution of incomes, as some had too much and others not enough. "I would say that that emphasises the Labour philosophy that citizens should receive what they need rather than what they earn for services rendered," he declared. "We should encourage citizens to be assets to society, not liabilities. The Prime Minister also made another statement. He said that the Government was giving the people more spending power. He may be giving them more money, but is he giving them more goods? Some of them will say, I think, 'Thank you for nothing.' The pensioners get increases of 12£ per cent. The cost of living will probably be up more that that. The Prime Minister also said that he has yet to see the man who works for ■ pleasure." The Prime Minister: Hear, hear. Mr. Hamilton: The Prirtie Minister says "Hear, hear." That expresses Labour's philosophy that idleness is preferable to work. It is carried out in practice, where we have sustenance instead of work. I believe the idle man is the most miserable. The Hon. R. Semple (Minister of Public Works): You are making deliberate misrepresentation. Mr. Hamilton: It is nothing of the sort. SOCIAL CREDIT. Mr. Hamilton touched on the Prime Minister's reference to social credit. Mr. Savage, he said, had been delightfully vague about it. .It was one of the embarrassing promises that were coming home to the Labour Party. The Prime Minister had said he was going to build homes by social credit, but when he explained it he said he was going to borrow money and pay interest. Why humbug about it? Why not be frank and plain? If the Government were going to use public credit, let it say so. Mr. Hamilton said that the Budget over-emphasised spending and underemphasised the creation and preservation of wealth. It over-taxed industries to keep the thriftless in idleness. It fully emphasised the Labour Government's philosophy of spending in preference to saving, that saving was an evil and drawing interest a crime.

He pointed out that in the Budget the Minister of Agriculture was not mentioned and the Minister of Lands hardly mentioned. That was significant, he thought. They were the two most important issues to New Zealand and they should have some prominence in the Budget. He would be glad to hear both Ministers explain why they were not in there. It would look as if spending were more important than producing. He thought the Labour Party had wonderful luck in winning the last election; the favourable state of the country's finances was its good fortune. On existing taxation the Government had shown how to increase the revenue by more than £3,000,000. That was a legacy that had been left it when.it came into power. No matter how the past Government was criticised, there were few countries in the world that had come through the slump ready to take full advantage of the'return to prosperity. .The present Government had added £.4,817,000 extra to the spending power of last year, and in addition £3,500,000 was to be borrowed, thereby giving New Zealand an extra spending power of £8,317,000. "It is the duty of the Minister of Finance, when he has' the money to spare," said Mr. Hamilton, "to relieve the taxpayer as much as possible. It is the duty of the State not to tax industry; it should not put on more than is necessary. Did not the Labour Party promise to reduce taxation? How about the sales tax? It has a glorious opportunity of fulfilling that promise. It will never get another chance like this to abolish the sales tax. The last Government was waiting patiently for the time when it could have reduced some of the taxation." Mr. Hamilton mentioned that an extra £2,500,000 was being spent on additional social services, and remarked that once that was established it was difficult to prevent it from becoming permanent. THE PUBLIC DEBT. Coming to the question of the Public Debt, he pointed out that in 1932 the sum was nearly £282,000,000, and in the subsequent four years it had increased by less than £1,000,000. "It looks as if we are now going to add £4,000,000 to the Public Debt," he commented, "and during the Labour Government's present term it will probably amount to another £20,000,000. The Labour Government is continually railing against the bond-holders, but if the Government is against the bond-holders and against interest why borrow? What have the social credit advocates in this House to say about this borrowing and taxation? Let them stand up in their place and say thenpiece. The Prime Minister has. something to answer for to these social creditors who have supported the Labour Party and have been contributing factors in placing Labour on the Treasury benches." Mr. Hamilton said that the Government should think about the consequences of its legislation, and the consequences of some of it was pretty far-reaching. He described the taxation as political taxation, which would have mighty serious consequences. TAXING THE FARMER. "Was not the community value in New Zealand created by the big farmer who went into the backblocks? Was there any great profit in owning land? Was the price of land going up? If the farmer was working his land to the full capacity and if the land■ was carrying all' the population

it could, then why should the farmer be taxed? The Minister of Finance said that the graduated land tax was for the purpose of catching the speculator, but Mr. Hamilton contended that the tax would not catch the speculator. There was more trafficking in land in small farms than in big ones, and just because there were one or two speculators in land the Minister took up the attitude that he would tax the lot. If a man was holding a large area of land suitable for settlement and the area was not being worked to the full capacity, then why should not" the farmer be told the position in a straight manner? A farmer might be working his land to full capacity, and it might not be suitable for subdivision, and yet be subject to the tax. A graduated land tax was not justified without a classification of land.'

Mr. Hamilton said he would, agree to the graduated land tax if land were classified and there were big holdings suitable for subdivision which were not being worked. The large owner was often in the back country, and was the graduated land tax to be a reward for his work? If the Government would not classifiy the land then the farmer should have the right of appeal to a tribunal—say the Executive Commission of Agriculture. The appeal could be sustained if the farmer was working the land to its full capacity and it was not suitable for closer settlement. Mr. Hamilton suggested that after working expenses were deducted, farm lands were not earning 5 per cent, of the value of the improvements, plus the original price paid to the Crown for the land. Dealing with city properties, Mr. Hamilton said that the Minister would not catch the unearned increment in the land, but he would catch the big businesses. About three-fifths.of the income tax in New Zealand was paid by companies, and there was a good deal to be said that company tax was an indirect tax on small shareholders. "ELECTION HOAXES." "We have had some very clever election hoaxes in New Zealand's history, but guaranteed prices is well up on top," said Mr. Hamilton. He submitted that the actions of the Government were very different from their speeches. Had the Prime Minister told' the farmers the story that was now legislation it would have been a different matter altogether. He contended that the idea of the scheme was to enable the Government to get hold of the produce of the land. "The Prime Minister might know the psychology of the worker and the mob, but not the psychology of the farmer of New Zealand," he said. The Government would not give the farmer -the London price, the price over ten years converted into New Zealand money, the London price f.0.b., the local market was taken away, and costs had been increased. The Prime Minister said that he was taking the chains off the dairy farmer, but he was putting the leg-rope on, and even if the farmer was bailed, he would kick. What was to happen to the surplus if there was a surplus? He urged the Prime Minister to make a statement on the subject. If the surplus was not going to be distributed as a bonus, then the dairy farmer should know.

Mr. Hamilton agreed that the development of industries was desirable, but the actions of the Government betrayed their words. By taxation and higher working costs the Government was preventing capital from operating.

The basic wage had created a problem for boys of 18 and 19, who, under the legislation, had to receive the wage when they became 21. The consequence was that younger boys were being employed and the older boys were not getting a chance.

The Government was now appreciating the difficulty of the unemployment problem, continued Mr. Hamilton. At the end of March last there was a cash -credit of £406,000. The anticipated revenue was £4,210,000. The increase today in the number of the unemployed was 3559. Mr. Hamilton denied that the last Government had borrowed and spent money during the depression, pointing out that there was no! money available for borrowing. The returned soldiers were still about 5s below their economic pension. In conclusion, Mr. Hamilton contended that the Budget showed the deliberate intention of the Government to get control of New Zealand resources and to tax industry almost out of existence.