The Budget — and Wages

Hawke's Bay Herald-Tribune, Volume 81, Issue 10, 5 October 1937, Page 8

The Budget — and Wages

ACCOUNTANT, ,

Sir, — Labour Unions in their applications for increases in salaTies and wages have? during the past two years, made a strong point of the increased prosperity of the Dominion, and the ability to pay the extravagant wages asked for. Employers have contended with little success, that the increases asked for were quite beyond the ability of the country to pay. Stnange to say the receht budget issued by the Labour Minister of Finance, the Hon. W." Nash, proves the employers' contention right up to the hilt. The financial statement gives the total value of production" in 1935 as £98,860, 100, and the latest xeturns in being £114,200,000 an increaso of £15,400,000, . but Btrange to say saiaries and wages went from £65,700,000 in 1935 to £85,000,000^ at the last returnt an increase of £19,300,000, so that saiaries and wages increased by £3,900^00 more than the increased value of production. The differenca is 'of course made up by the increase of £5,109,102 ' in the publie debt, by borrowing.

To show ,tlie relative positions of total valud of production I should pbint out that this figure represents the total value of primary production, added to the total value of industrial output, i.e.f manuf actured production^ and the value of the work when it le^ves the factoiy. . ■ ; From the total .of £114,200,000 there roquires to be taken fipproximately £20,000,000 for dirqct Goverhment and local body taxation, to meet interest and sinking fund on loans, etc. The overhead charges • to be met by the differenca between the net amount of £94,200,000 after* deducting this taxation, include the rental value of the land, and the. interest on the value of stock and buildings used in farming, cost of materials used in industrial rqanufactune, rental (value :of buildings used in production, interest and depreciation on value of machinery used, cost of power employed insurance charges, etc., to; say notning of any profit whatever. Estimate the. value of these and sea' the difference bewteen the net value of production after only direct taxation has been deducted, and the amount paid in saiaries and wages. One significant item in the budget is that bank debits have increased from 1935 to the latest return from £676,200,000, to £91 6 '200,000 (exclusive of Govenrment debt) an increase of £240,* 000,000 with only £20,700,000 mortg-i ages discharged. Where are we sliding to? — Yours, etc.,

Oct. 4, 1937.