VIEWS ON BUDGET

Gisborne Herald, Volume LXVI, Issue 20007, 4 August 1939, Page 9

VIEWS ON BUDGET

HIGHER COSTS TIGHTENING OF BELTS POSITION OF FARMERS ANSWERS TO CRITICS SOCIAL SECURITY, DEFENCE (Per Press Association.) WELLINGTON, this day. The debate on the Budget was continued in the House of Representatives yesterday afternoon by Mr. J. Hargest ('Nat., Awarua), who expressed . regret at the illness of the Prime Minister, the Rt. Hon. M. J. Savage, and associated himself with the Leader of the Opposition, the Hon. Adam Hamilton, in wishing him a speedy recovery. !He also added that any criticism he might make of Mr. Savage .was not directed at him,personally but at the Government’s policy. To thousands of people, said Mr. Hargest, the Budget meant harder times,, a general tightening of belts,

higher costs to the business and farming communities, and a lower standard of living. The outcome would be grave discouragement to industry. He stressed the difficulties being experienced by people living on fixed incomes as a result of the Government's policy, stating that these people’s cost of living was continually rising bul their incomes were going down. He proceeded do detail the incomes of certain, classes of civil servants whose salaries, he said, had certainly been increased 10 per cent, but the cost of living had increased 20 to 25 per cent. Was it any wonder, he asked, that the public service was seething with discontent? He contended that the terms of the recent conversion loan arranged by the (Minister of 'Finance, the Hon. W. Nash, were onerous, and he was doubtful that the conditions could be carried out. Overtime to Hear Minister Mr. Hargest also expressed the opinion that the farmers would revolt against the imposition placed upon them by this-rapacious Government -The Deputy-Leader of the House •the Hon. P. Fraser: If they try that game they will be treated the same way as other Governments have treated the others. Mr. Hargest said the Budget was one of discouragement. The country was alarmed and In a state of despair. He proceeded to criticise the Government’s public works policy, and stated that some 800 men had been paid overtime to listen to the Minister of Public Works, the Hon. R. Semple, address them at Temuka on defence matters, at a cost of not less than £3OO. Mr. J. G. Barclay (Lab., Marsden) said members of the Opposition had said the Social Security Act was going to cost in the first year up to £26,000,000, but to-day it was found that the Government had over-esti-mated the cost in the first year at least. Recompense to Farmers The member for Awarua had spoken of the farmers being responsible for increased production in this country. Certainly they had made a magnificent effort, but what was the result of the increased production? In 1935 it landed 50 per cent of the dairy farmers in bankruptcy. Something more was required, and the Government, by means of the guaranteed price, had endeavoured to recompense the farmers for their increased production. A lot had been said about public works and, of course, with the expenditure of such a large sum, some points were open to criticism, but he thought that most members of the Opposition wanted public works to go on' in their districts. By and large, the Government was proud of the public works, which were leaving behind a great asset. Every country to-day, he said, was increasing taxation because of reanpament. In New Zealand- the increase was for defence and social security, and, in the latter, the people got something" back. The Leader of the Opposition had said the Government should see that the farmers were protected, Mr. Barclay said. He wondered how much protection Mr. Hamilton gave the farmers during the life of the Coalition Government. The Labour. Government was giving some protection to the dairy farmers, and it was willing to do the same for the sheep farmers. Defence Estimates Compared (Mr. A. E. Jull (Nat., Waipawa) said the Government, in the course of the Budget, had asserted that the proceeds of the additional tax levied on petrol would be used for defence purposes, but he noticed that there was no greatly-increased sum for defence mentioned in the estimates, which wkre much the same as last year. Mr. Fraser: There is over £1,000,000 more. Mr. Jull said the Government had claimed a wonderful achievement in raising the wage level by 7$ per cent, but he pointed out that the cost of living had increased a great deal more than that; If the present policy were pursued the standard of living must

come down. He criticised the expenditure on public works, stating that some people were calling the Minister of Public Works “Public Enemy No. 1” as far as expenditure of public funds was concerned. Mr. Jull then went oq to discuss the position of the Highways Board in relation to finance, stating that if the present system were continued the main portion of the highways funds

revenue would soon be used up in the payment of interest rates on loans and sinking fund. The debate was continued in the evening by Mr. Jull. He advocated the abolition of hospital rotes on rural land, and also the abolition of land tax. ' , Mr. A. H. Nordmeyer (Lab., Oamaru) said the Leader of the Opposition on the previous evening had criticised certain members of the Government for daring to attack the Prime Minister and Cabinet of Great Britain. Mr. Hamilton said he did not object to the criticism, but he did disagree with the attack on British Cabinet members. Would he define the difference between criticism and attack, asked Mr. Nordmeyer. It might be said that Mr. Hamilton had attacked Mr. Savage and the present Government of New Zealand in his speech, although he called it criticism. Incidence of Taxation No member of .the Government benches, he said, would adopt a servile, sycophantic attitude to the people in authority in Britain when they believed them to be mistaken. Dealing with the taxation provisions in the Budget. Mr. Nordmeyer said that, except for small increases in 1936, the present Government had not until now increased the incidence of taxation. Referring to the cost of the social security scheme, Mr. Nordmeyer said it would be £12,000,000 for the present year. If the whole of the medical benefits had come info operation at the beginning of the scheme the cost would have been approximately £2,000,000 more and, if an additional £2,000,000 for war pensions were added to that, the total cost of the whole scheme would have been £16.000,000. The lax of Is. in the £, plus the annual and quarterly levy payments, brought in £9,200,000, and last year’s pensions vole was £7,000,000, making a total of £16,200,000. Therefore the whole cost of the scheme would have been met from the consolidated fund. The cost was actually much below the Government estimate and far below the exaggerated figures predicted by the Opposition. State of Intoxication Mr. W. J. Broadfoot (Nat., Waitomo) said ho wOnderod how many of the Left Wing members of the Gov-

ernment would back up the Budget, because when it had been read to a staggered House they had been a picture of misery. The country was suffering from a state of intoxication a. the present time, he continued. We were not only absorbing all the revenue being produced, but also the reserves set aside by the previous prudent Governments and the savings of prudent people. Mr. Broadfoot said the Budget seemed to have made a direct onslaught on the farming community which supplied the export commodities. What of the problem of seasonal workers, he asked. He had suggested a small farm scheme for them, but nothing had been done. There were hundreds and hundreds of men on public works who could well have been' trained for industry, instead of bringing artisans to the Dom’inioin from overseas. He went on to criticise the Government for unproductive works, and, speaking of the Government's policy of intelligent control of credit and currency, he remarked goodness only knew where the country would have been if there had been unintelligent control during the last four years. Iron and Steel Industry With regard to the iron and steel industry, Mr. Broadfoot stated that the cost of its inauguration would be in the vicinity of £5,000,000, whereas, if it had been undertaken . five years ago, the cost would only have been £3,000,000. Where was the Government going to raise the money to start this industry? Was it to come from the Reserve Bank, or was tl.e Government going to ask private people for a loan? Mr. E. P. Meachen (Lab., Marlborough). characterised Mr. lull's statement that the Minister of Public Works was.“ Public Enemy No. 1" as grossly unfair. Most people, he regarded the Minister as "Public Benefactor No. I,’’ and were grateful for what the Minister had done to save the lives and limbs of people. Mr. Hamilton, in the course of his address, had stated that there were a lot of tradesmen on .public works and on relief. “I want to give that statement an emphatic denial,” added Mr. Mcachcn. “Public works engineers are crying out for carpenters and fitters, and cannot get them. It has been said also that tradesmen are on relief. That also is not so. Surely no sensible person can imagine a qualified carpenter remaining on relief when he can enjoy steady work and good conditions at his own trade. The whole thing is absurd, like many statements the Opposition has made. The member for Awarua had stated that it had cost the country some £3OO for the Minister of Public Works to go down to Temuka to address men on public works on defence. That statement was'also' absolutely incorrect, said. Mr. Meachen. The debate .was interrupted by, the adjournmerit at 10.30, add the House rose until 10.30 a.m. to-day. , .