CLOSING OF BUDGET DEBATE

Gisborne Herald, Volume LXVI, Issue 20024, 24 August 1939, Page 11

CLOSING OF BUDGET DEBATE

MINISTER REPLIES

VIEW ON FINANCE

MINIMUM BORROWING

SIGNS OP PROSPERITY

FEWER FARM SALES

FORETCIX-POLTCT. OPINIONS

(Per Press Association.) WELLINGTON, this day. The acting-Lcader of the House, the Hon. P. Fraser, replied to the debate on the Budget in the House of Representatives last night.

He thanked the Opposition and all those who had expressed sympathy with the Prime Minister, the Rt. Hon. M. J. Savage, in his illness, and also extended the Government’s sympathy to those who had suffered in the recent floods in the Manawatu and elsewhere.

Speaking of the Budget itself, he expressed the opinion that it had been favourably received by the country. None had expected that increased taxation would be received with enthusiasm, but even to this there bad not been undue opposition. The Opposition had criticised the Government on being unorthodox in its finance, said Mr. Fraser, and at least one member had complained that it was too orthodox.

Mr. S. G. Holland (Nat. Chch. N.): THat is the member for Grey Lynn. Mr. Fraser: No, it is not. There is no difference .between the views of the member for Grey Lynn and the rest of us.

The Opposition members said the Government had gone too far but they would not indicate in which direction.

Mr. Fraser said that early in the debate Mr. A. H. Nordmeyer (La'b., Oamaru), had challenged the Opposition to say what reserves the Government had raided, when and by whom such reserves were established, and when and in what manner they had been raided by the present Govcrn-

ment. That challenge had not been accepted. The present Government had balanced its Budget each year since it had been in office, and capital expenditure had been met, not by borrowing overseas, but by using departmental surpluses, the Post Office savings, and also by calling on the credit of the country for the use of New Zealand through the Reserve Bank.

Raising: of Loans

Referring to the question of raising loans, Mr, Fraser said that the members of the Government in the past had never contended that loans should not be raised. They recognised that in a young country borrowing was sometimes unavoidable, but the Government did say that overseas borrowing should be reduced to a minimum and it had not borrowed overseas until tlte recent £17,000,000 loan. The credit used by the present Government was the credit of people of New Zealand, not credit from overseas. He then went on to deal with the position of the farming community and quoted a decrease in the number ' of farm sales, which, he said, was proof conclusive that the farmers to-day were better off than they had ever been.

Mr. Fraser said the Budget had faced up to realities in that it showed the Government’s determination to maintain the progress made by the country. That was one thing which the Government was absolutely definite about. Tile internal prosperity of the country was sound, he said. The people were good and the resources were great. Standard of Living The country was able to maintain its standard of living and the Government would never be a party to cutting the incomes of people or reducing their standards. Mr. Fraser then referred to the question of foreign policy, defending the right of members of the House to express their opinions concerning it. Mr. F. W. Doidge (Nat. Tauranga): Do you then agree with the Government member who says Britain is adopting a double-crossing policy in the Far East? Mr. Fraser replied that it was the right of an individual member to express his own opinion, even if he Mr. Fraser, personally disagreed with it, and he did disagree with it. 7’he Minister proceeded to stress the value of co-operation with the United States. This country had the greatest feeling of friendship toware.s this great democracy, ho said, and also towards the great man at its head. Discussion of Estimates When Mr. Fraser had concluded hU speech the House went into committee to discuss the first item of the estimates. Mr. .1. Hargc.st (Nat., Awarua), while congratulating the Minister of Defence on the increased provision made for national defence, said he hoped he would not be accused of jingoism it lie urged the Minister to persuade his colleagues to divert pait -,C the vast expenditure in other directions to defence. A territorial force of 1(1,000 was not enough. A force of 40,000 would not be too great, he said. lie was not decrying the expenditure on social legislation, but every piece of legislation placed on the Statute Book for the past 80 years would go for nothing unless we could

kcep this country inviolate against an aggressor.

Mr. .T. O’Brien (Lab., Westland) strongly deprecated the suggestion, which lie contended Mr. llargest had made, that increased provision for defence should he made at. the expense of pensioners, widows and orphans. New Zealand was worth defending, but it would not be at the expense of those in need of State assistance. Finance For Defence Mr. Fraser said there would be no difficulty about finance for defence. This year a sum of .525,400,000 was being provided for the purpose and jc was unthinkable, if New Zealand were to do its duty, that the question of finance for defence should stand in the way and it would not stand in the way. Further, it must be apparent to everybody that _if this country were threatened with invasion, not only every human being, but every penny in the Dominion and every ounce of property became part of the defence system of the country.

Mr. J. A. Lee' (Lab., Grey Lynn) said he hoped 'that people would refrain from spreading fears of invasion that were not justified. He said that if the necessity arose they would have as many men available as were required. Mr. F. W. Boidge (Nat., Tauranga) said that Mr. Lee had stated the Government would determine what to do when it knew the nature of the crisis, but he would issue a warning that war would come overnight and preparations could not be made as quickly as that. It had been a struggle to get 16,000 men and we would not have had these to-day if the veterans of 1914-18 had not come to the rescue.

The Minister of Defence, the Hon. F Jones, said that honourable members of the Opposition seemed to be mixing up the reserve with the toiritorials. We had 16.000 men to-day, all of whom had passed the doctors. The Government had thought iwould take three months to get them and they had' done it in six weeks. Tlie defence expenditure had been doubled, he said, although he did not know if nil the money provided for would come to charge, because of the difficulty in getting equipment from the manufacturers. The Government had placed large contracts in New Zealand for clothing and food etc., and also large contracts overseas for ammunition and stores. Even if thev increased the estimate by .£1,000.000 immediately, how could it be spent when one of the greatest difficulties was to get the supplies required? Progress was reported at 10.30 p.m. and the House rose.

On the motion for the adjournment Mr. Fraser said that it was intended to take the Finance Bill and Income Tax Amendment Bill to-day.