Mr Macarthur in Reply to the Premier

Feilding Star, Volume XIII, Issue 134, 10 May 1892, Page 2

Mr Macarthur in Reply to the Premier

The Assembly Room was well filled last, night by a representative audience, i which included visitors from all parts of the electorate. The Mayor, Mr W. G. Haybittle, occupied the chair and in a brief and appropriate speech introduced i ' Mr Macarthur. Mr Macarthiir after referring to the object of the meeting said that on first reading the speech of the Hon. John Ballnnce at Feildiug, he had thought it was not worth answering, but after a while it occurred to him that if the statements contained therein were not replied to it would be assumed by the other side that they were unanswerable. At any rate he would show the other side of the question and leaye them to judge. No one would deny that the Hon John Ballance was a plausible, not to say glib speaker, with Me art of using spacious arguments, which he put into requisition there the other night to a very great extent. It took many more words to disprove an assertion than to make one, and as their time was limited his difficulty was to reply to Mr Ballance without taking up too much of their time, therefore he would be as brief as possible. The first and most important question which the Premier had dealt with was the new system of taxation that had been introduced, and in connection with that the withdrawal of capital. Now, no Government ever had a fairer chance than the present Government. When they came into office there was £140,000 to credit and a further surplus accruing from the revenue during the current year of £100,000. When a statesman in the Old Country found himself in possession of a surplus he would at once consider what taxation might be reremitted. That would be his first thought. But no, our Ministry only considered what they could put on. With this surplus of £•240,000 they might have reduced the Customs by £100,000 and remitted half the Property Tax, and that would have given a great impulse to the industry of the colony, but instead of that they had put on more taxation. All they had to pride themselves upon was the small remission of £60,000 in connection with the reduction of postage, which however, was not yet in force and the probabilities were it would not come into force. Now he had no fault to find with the £3000 exemption allowed on agricultural improvements, and at his last election he spoke in favour of such an exemption as far as the revenue would allow. He did not want to defend the Property Tax, but it had this one advantage that it was intelligible, and that after an exemption of ' i'soo it fell on all kinds of property alike a-.id that was where it differed from the present tax winch, as he would show, bore more hardly upon the farmers and producers than the Property Tax. The most usual way of describing the incidence of the present taxation was that while all other businesses paid Is in the £ Income Tax, on a five per cent basis the farmer paid one shillins and eight ponce in the &. But that did not put the |case half strongly enough. All income under £300 were exempt from taxation, and taking a tive per cent basis that represented a capital of £6,000 which escaped taxation altogether, whereas the farmer only escaped exemption on £3,000. Take the case of two men landing in the colony each with £8,000. The one man puts £6,000 in the bank and spends £2,000 on furniture, etc. The tax-gatherer never came to him and whenever he chose he could sell out, take his money and go. The other puts his £6,000 m land, and expends £2,000 m improving his land. If lie borrow an additional £2,000 he was taxed upon the full amount less £3,000, while the other only paid Customs duties. Now contrast the use of these two men to the colony. The one was doing the heroic work required in colonisation, and the taxation which treated these two men in this way was not right (Applause). He would admit that the two cases here cited were extreme cases, but they would serve to show the spirit of the tax. Take the exemptions in globo and contrast the way in which they were worked out. The whole of the exemptions amounted to £60,000, and of that £60,000 the cities for their improvements got just one half, so that £30,000 was the exemption given to the producing classes. Of course the farmer's stock was exempted from taxation but so was personal wealth of every other description, and as fourfifths of the personality was in the cities the farming class only got one fifth of the exemptions. It the ercnt, too, of a reduction o£ £60,000 in the postage the towns and cities would receive four fifths of the remission. They would thus see that although Mr Ballaace claimed to be the farmer's friend it was not in the matter of taxation. Now, a certain class of small farmer's did escape the tax, supposing their valuations were kept down, but that was not the case for they had been deliberately raised by the Government. He would show howaver, that owing to the way in which the Go vernment had taxed loan companies, people who had to borrow from them had to pay an increased rate of interest amounting to more than they paid under the Property Tax. Of course it did not affect a man until his mortage matured when the farmers would find ifc out for themselves. The Governnent saw this point as well as they did and they had made streuuous efforts in eyery direction to show that capital was not being withdrawn and had made the most absurd statements. Mr Ballance had said the onus of proof that capital was leaviug the country lay with the Opposition, but to follow the rules of evidence when they had a prevaricating and quibbling witness like the Government they must disbelieve them. A 9 an example of their quibbliug he quoted from the Dunedin Star statements made by the Government as follows : — First by the Premier: " Capital ib not being withdrawn at all." Secondly, by the Minister of Lands : ' ' Capital is being withdrawn from the country on account of the unexampled prosperity of its farmers during the last two or three years." Thirdly by the Minister of Justice : ' ' Capital is being- withdrawn to make room for more capital." Fourthly by the Premier a 'min : " The more capital withdrawn the better." Fifthly, by the Premier again : "Capital is being withdrawn because there is a collapse in other countries thousands of miles away from here." And last, by the united strength of the Government: " But no capital is being withdrawn at all." Mr Ballance said the onus of proving that capital is leaving the country rests with the Opposition, but there were none so blind as those who wont see. As an agent of a loan company and having connection with other loan companies, he (Mr Macarthiir) was able to say here that capital was being withdrawn and to a large extenti If Mr Ballance really did not believe that capital was being withdrawn he could easily prove it. The Registrar of deeds has a list of all mortgages, and by obtaining a return showing the results of last year and of the present he could produce absolute proof as to the truth of his assertion, but he carefully retrained from bringing such proof. He would, however, move tor that return as soon as Parliament met, and the colonists would see the truth of what he had stated. The influx of foreign capital kept down the rates of interest — that was as clear as daylight, They must remember that the nuw 'taxation A.ct was only six months old ; it was passed last session and some time elapsed before its full bearing was known at Home. If the evidence ofanthorities of any financial standing ore to be relied on, capital will be with- j drawn because of duplicate taxation. Any- 1 thing that checked the competition of

foreign capital was an injury to the colony, and it was a proof of the ignorance of the Government to deny that it was deing withdrawn. Mr Ballance said that capital was not leaving because thft bank deposits were increasing, but the fact was the money was being banked preparatory to its being withdrawn. The matter was all the more important in the j light of Mr Ballance's own statement that nearly all the small farmers were mortgaged. It had been said by Mr Ballance that the rate of interest had not been raised because some firms were advertising money at 5 percent, but he would ask any one there whether he had been able to get the money at five per cent ? (Hear, hear, and laughter). There were always some persons who allowed their advertisements to stand just like drapers. It served to bring custom, but when they had the fly in their web then they could make their own charges. (Laughter.) Another proof given by Mr Ballance that the rates of interest had not been raised was that the Government Insurance Office could not get 6-i- per cent for money. But why could not the department get that ? Because, if people went to the Government Insurance Department they would only consent to lend on their own valuation, and people would not agree to lock up their capital in this way, and went elsewhere for the money they required. The eyil of the withdrawal of capital would be that the rate or interest would certainly be raised. There were about .£30,000,000 worth of mortgages in the colony, and an increase of one per cent on this would amount to ±'300,000, nearly equal to the whole of the Property Tax, and the farmer had to bear nearly the whole of that burden. The average yearly inflow of capital had been from .£600,000 to ±700,000. Last year it was ±900,000, and when all that capital was coming in and competing two lenders were looking for one borrower. With companies withdrawing their money, however, mortagors must find others to lend them money, and the consequence would be that the rate of interest must rise. From hisown enquiries he had found that the rate of interest had positively gone up from a half to one per cent throughout the colony, and there was no guarantee that the increase would stop at that. The difficulty now was that money was being, attracted from other enterprises into mortgages, and the money being demanded by the mortgagee, brought tightness in the money market. Mr Macarthur here referred to the favourable treatment accorded to banks in comparison with loan companies. The banks, he said, paid a shilling in the £ on their income only and nothing on their mortgages, thus throwing the money lending business into their hands. It was not likely that they would cry out against such a system. Mr Macarthur here briefly summarised the arguments he had used, and went on to refer to the part played in London by Mr Perceval, who had written to the London Times, stating that foreign capital was not taxed more than of old. This was however directly contrary to the fact, and Mr Perceval must have known, that his assertion was utterly untrue. Now what would an honest Government have done but to assure English investors that the AgentGeneral had not properly represented the matter, or that they were going to amend the Act. But they had done neither, and therefore by their silence they were committing a gross breach of faith with the English people. With regard to the absentee tax he was always opposed to such a measure. The absentees were citizens of the British Empire, and had a right to live where they liked. The tax which had been imposed upon them, however, had resulted in a loss to the revenue. They owned abont ±8,000,000 worth of property. Of this amount £3,000,000 was invested in laud, and about £5,000,000 was personal property, 3£ millions of thai amount being mortgages. The whole of the graduated tax ou persons was £46,000, and it was estimates that one- fifth of this was paid by absentees. This was roughly £10,000, and 20 per cent on that was £2,000 extra, while they were exempted on about a million and a half the balance of the 5 millions of personal property after deducting 3£ millions of mortgage, consisting of stock, etc. The net result was that though they paid £2000 additional in one direction they were let off to the extent of £7,500 in another. Mr Ballance had used one expression there that they were not going to be governed by siyndicates, and he (Mr Macarthur) agreed with him. That wa3 the last thing he wanted. They wanted to be governed by their representatives in Parliament, but unfortunately they had a Government that bowed down to secret syndicates of Trades and Labour Councils (Laughter and applause) who would haye them submit all their nominations to the Legislative Council and all Government measures to them, and the Premier had humbly apologised to them, because the Government had once exercised its own discretion in a certain matter, It was the first time wo had this bowing down to sjndicates in New Zealand, and he thought it would soon come to an end, and they would never see it again (Applause). As to the land policy of the present Government, that was a matter on which many of them were as well informed upon as he was. Ministers had claimed credit for a iarge amount of settlement chiefly on account of the new special settlement scheme. He was in favour of special settlements but not under the present conditions, which were framed by a Minister who had liyed in the open plains of Otago all his life. A good many valuable settlers had gone in for land by joining these associations, but the Government must not claim for their occupation of the land as although some ballots had been taken the land was not actually occupied. Many of those meinbera of associations who had paid 10s would proceed no further and the Government could not compel them for two years. Wo know that of the land held by the Crown, some is first-class, some aecoud, and some third, on much of which last two classes a man could not make a living on 140 acres, or 200, and mauy of the members would think it expedient to forfeit what they had paid. All these fine theories of men making a living on 20 acres would not work, and if members of the Ministry would try it themselves for a while they would come off it much thinner than when they went on, and with very different ideas as to land settlement. Twenty acres might be made to pay near a town, but it meant dairying and endless toil for i wife and family. That was not what they came out here for, but to be able to sit down at ease in their old age. That was the hope of every man who became a bush settler not that he and his family should toil and moil from eleven to fourteen hours a day in order to make a living. See those village settlers up north, who stay on their small sections because they could not get off them (a voice "serfs' l^. Worse than serfs, because there was no one to take an interest in them. He did not believe in monopoly or large estates, but estates of moderate size. He had been occupied a good part of his life in trying to break up the Manchester Block into small holdings, but he did not believe in coming down to the twenty-acre point (applause) ; the three acres and a cow might suit the English laborers, but were not sufficient for the colonists. A very vexed question was that of the perpetual lease, pure and simple, without right of purchase. He had come across a good many settlers but he had yet to meet the man who did not believe in the right of purchase It wns quite likely that there were such persons in the towns, who did not intend to come into the country. The Govern* ment asserted that the perpetual lease

tenure was the most popular one bat they took care not to trust people with a clause given them the right of parch ase. That was the whole secret of dispute with the Legislntive Council. They had very strong statements as to the loud nationalisation tendencies of the Got*eminent but recently they had drawn in their horns, Mr Ballance especially had pretended that it was only the unsold land they desired to treat under that I scheme. Mr McELenzie had said that I fifty years hence there would not be a j Crown grant in New Zealand. That I showed the drift of his opinions, and what he would do had he the honor to fulfil bis own prophecy. As showing the views of the Mr Ballance on the question he read an extract from the writings of the hon. gentlemen. In regard to the graduated tax Mr Mncarthur did not consider it in accordance with the principles of j nstice. It was wrong to sell land for a certain price nnd immediately to use the power of the State totnxit back again. To take land back again by penal taxation was a breach of contract with the individual. In speaking of land values the land nationalisation party said Unit the community created the unearned increment as they call it. ■ This was said by men who had come here at the eleventh hour concerning those who had " borne the heat and burden of the day. The fact is, if there had been no pioneers there would now be no community, or unearned increment either, and these mendeserve their reward. Much had been said in the Government organs with respect to a statement that the Government was " galloping to a deficit." This had been said by Mr Richardson in the House, and it had since been attributed to the whole of the Opposition. But it was well known that there was no possibility of the Government galloping to a deficit, because they were yet working |on the finances of the previous Government. The income could be calculated to a certainty by the heads of the departments, who would be there|to receive it even if there were no Government. Except this one expression made by a member of the Opposition such a result was never anticipated so long as the Government continued to rely on the finance of the last Government. He did not think there would be a deficit nezt year, but if it came to pass it would" be due to the present Government's extravagant expenditure. The Government got appropriated last session L 935.000 for public works. He did not know how much of that was left, but there were indications they proposed to borrow in the colony. The Premier, in criticising the platform of the Political Association had said that the Association had denounced borrowing, whereas they protested against more ex« travagant borrowing, but they considered that some farther borrowing was requisite for opening up Crown lands. What the Association objected to was the extravagance of going in for a large railway policy. They also considered that borrowing in the colony was extravagant borrowing, because they would have to pay one or one and a half per cent more for it, which would go into the pockets of middlemen, the banks, which Mr Ballance was so fond of, or the syndicates, A new system had lately been introduced of letting contracts. The Government engineers had received orders to let work at such prices as would enable the most indifferent of workmen to earn seven, eight, and nine shillings a day. He had received this information from an official who had left the Government service. Some of the men on the co-operative works were making twelve and fourteen shillings per day, while the farmer and settler toiled away and could not get a fourth of that. He was of opinion that the work now being done should be done by the local bodies, who would see that the money was properly expended. There ! was no doubt that the Government were erecting an immense political engine for the next election in thus providing work for all comers, and giving higher wages than were paid by other employers. He did not believe that anyone should be allowed to starve, but he thought a somewhat less rate of wages should be paid for labour on relief works than for ordinary employment, Haying briefly recapitulated the points of his speech Mr Macarthur resumed his seat amidst heartly applause. The chairman having invited questions, Mr Thomson asked Mr Macarthur if he was in favor of the dual vote. Mr Macarthur was glad to be reminded of this subject, which he had forgotten, and expressed himself as being decidedly in favor of it. He also predicted that in a few years the great bulk of the people m the colony would be forced into the adoption of the same political plank as a means of protection against the domination of the class which had driven the Victorian farmers into seeking more political power. Mr G. Wilks inquired (1) whether Mr Macarthur would take into consideration the establishment of arbitration and : Conciliation Boards for civil cases? (2).Whether he was in favour of woman's ' suffrage, and would ho vote for it ? (3.) Whether he would support a bill giving adults, male or female, in each district a direct vote to regulate the liquor traffic. To the first resolution Mr Macarthur said he would take it into consideration. In reply to the second he declared that he had consistently supported it. In regard to local power to veto the liquor traffic Mr Macarthur expressed his willingness to concede what was asked if fair compensation were paid in the case of licensed houses closed for any reason except the misconduct of licensee. Mr Matthew asked why it was that the Government had fixed the land tenure for the special settlement leases of 21 years, but this Mr Macarthur said was contrary to their own regulations. Mr Morey asked for a farther explanation of the absentee tax, a request which was acceded to. Mr Atkinson proposed that this meeting regrets that the vote of thanks and confidence passed as au act of courtesy to the Premier at his meeting at Feildmg has been misinterperted by the Government as a proof of the approval of the settler? of this neighbourhood of the policy of the Government. Haying now heard the other side of the question from the member of the district, while passing a vote of thauks and confidence m Mr Macarthur this meeting is of opinion that the policy of the present Government is inimical to the best interest of the permanent settlers of the colony. Mr Gosling seconded the motion which on being put; was carried unapimously. The meeting terminated with a vote of thanks to the chairman. Cobbe and Darrash have imported a big lot of English blankets ond rufts. They have also received a full assortment of colonial blankets direct from the makers. Prices are lower this season than last. Ammunition at the Red House. S. J. Thompson wishes the sporting community to know that he is now prepared to supply all their requirements. Diamond grain powder, all numbers of shot. Gun caps, breech and muzzle loading guns.— Adtt. '• A drink for the gods," so said the great Prophet — Mahomet, when taking his cup of coffee under the fig tree. If you would enjoy such, Crease's AI Coffee, Sold only in 1 and 2lb tins. If you would liye long and prosper drink good Coffee. It maketh the heart glad, keepeth the brain clear, and helpeth digestion. Be sure and ask for Crease's AI Coffee. Sold only in 1 and 21b ting. There is one thing every housewife should know, and that i3— Hercules Biking Powder is the best. Wby? It is the cheapest, because it is the best lor making bread, pastry, cakes, puddings, scones, etc. In 6d and It tins.