£60,000 WAS PAID FOR ASSETS OF PICOT BROS.

Hawke's Bay Herald-Tribune, Volume 81, Issue 51, 23 November 1937, Page 3

£60,000 WAS PAID FOR ASSETS

OF PICOT BROS.

-Press Association.)

FINANCE DEBATE What Interest Will Be Paid on InternaT Borrowing ? PUBLIC WORKS LOANS

(By Telegraph-

WELLINGTON, Last Night. When the House resumed at 7.30 the Minister of Finance (Hon. W. Nash) moved the second reading of the Finance Bill. He said the main Bill was divided into foxxr or five parts. One part dealt with the soldiers' settlement and it was anticipated that in writing off this account the total loss would bfe £6,820,000. It was the account only which was being done away with, not the other legislation dealing with soldier settlement. With regard to the wiping off of the Stato Advances account, when all the accounts were settled up there would be only a comparatively small anxount to be written off. Another part of the Bill, said Mr. Nash, gave authority for the borrowing of £6,000,000 for public works. This ainount was not immediately necessaryand tho Government was trying to make ptovision for a!l public works during this session until tho conxmencement of the next session, but the authority was there 'for the borrowing of the six millions or part thereof, if required. *Mr. W. P. .Endean: Where will you •borrow that money from? Mr. Nash: I think mostly in tho Dominion, but_ certainly not overseas. In reply to a further interjection by Mr. Endean, who said he only wished' to know how the public money was being spent, Mr. Nash said there was no suggestion that any money was being spent in New Zealand In anything but an open manner and it'^was a pity the honourable gentleman should go to Sydney and make statements in tho press that were derogatory to the interests of tho Dominion. ,-Referring to.tho setting up of a bard.ship committee under the . graduated land tax, it would operate for two vears and deal with taxes -falling due on . March 31, 1937, also on March 31, 3938. It woxxld comprise ihe Commissioner of' Taxes, Solicitor-General and Secretary of tho Treasury. It would deal with cases where hardship existed and the committee would be limited in the sca'-3 of its inquiry and would bo able to recommend to the Minister what relief it thought might be necessary. Tho Minister could then reeommend that' ,the relief suecested could be granted, j Gold-mining Income-tax. tho Minister proeeeded to deal witfi the provisions in the Bill covering paytnent of income tax by goldmixiing companies which he said paid income tax not on income but on profits. The Bill would enable taxcs to be levied on the assets of companies which had been. transferred overseas. Another clause exempted from stamp duty all transfers of houses from local authorities. It had arisen through the requirement of the Dunedin City Council, ^hich had done splendid work in erecting houses to relieve the housing shortage and desired to transfer the ownership of the houses to prj,vate individuals. Another section incrcased the time which pcrsons in receipt of invalidity pensions might be absent from the Dominion without forfeiting their pensions. Dealing with the provisions in the . i Bill providing for payment of the new season's prico for butterfat for produce exported between July 31 and September 4, the Minister stated the total loss would amount to £38,000. This sum would be distributed to dairy companies for distribution to i'armers as soon as the Bill was passed and the accounts wero in order. The next clause in the Bill dealt with differential cheese paynxents, the extra fartlxing provided for in tho Bill cnabling butterfat suppliers for cheesa to receive an average of lid per lb. more than did° the suppliers. of bufcter. Tho total cost of this increase would be about £165,000.

Speaking of the Internal Marketing Department, Mr. Nash said the Bill would enable the Department to carry on. •Opposition members: How much did Pic'ot Brothers cost? Mr. Nash: I think it was about £60,000 for the assets, He added that if the company had been sold on the stoek exchange it AMould have brought about twiee as much as tho Government had paid for the . company. It was one of the finest distributive organisations in the Dominion. Mr. (S. G. Holland: How much did the goodwill cost? . Mr. Nas^: I'll tell the honourable gentleman that a little iater. Mr. Holland: "We would like to know the anxount for goodwill. The Minister replied that it would be advisable to have the discussion on that on the Estimates or when considering tho department 's report. Members were certainly entitled to know what the sum was and ho would certainly tell them. The leader of the Opposition, Hon. A. Hamilton, said there w'ere 40 different subjects discussed in the Bill and he did not intend to deal with them all in his half-hour's speeeh that evening He said he had been pleased to learn from the Minister that tho State Advances account was in a healthy condition. The State Advances system had worked very well in its day. Commenting on the provlsion in the Bill to borrow £6,000,000 for public works, Mr. Hamilton said the Government was a great' borrower but objected to paying interest. Wliy should it borrow if iti did uot pay interest? Mr. Savage: Tlierc is nothing objeeting to .paying interest in tho Bill. Mr. Hamilton: Yes, but it is a wellxtecpaqised plaak gf ihe Lab^ux Parir0

In fact some members of that party have intimated that interest will bo abolished altogether. Mr. Parry: Quite a lot of Christian people agree with that. Mr. Hamilton: I think the honourable gentleman had better leave Christianity out of the discussion on this 'Bill. I am prepared to debate it with him at another time but not in connection with this Bill. He continued to deal with the hardship clause under the graduated land tax, stating that the Bill carried out the Minister 's promise to set up a committee to investigate hardship undei the tax. He thought it was a very conservative committee, two of its members being tax collectors themselves. He thought the graduated land taxj should he abolished altogether because; it was most iheqxiitable and was 90 per ' cent. unjustified. Until there was ai classification of land there was no justification for the graduated land tax at all. It hit companies with branches throughout the Dominion and also large fawners whose holdings might be quite unsuitable for subdivision. A clause should be inserted in the hardship clause stipulating that the person 's ability to pay should be considered in the assessment of the tax. He thought it unwise that the committee should have to refer its decisions as to who paid the tax to the Minister. The Minister should write the law and leave it to his ofacer3 to administer it. Mr. Hamilton said he failed to see why the Minister had not put the price paid for Picot Brothers in the Bill. Mr. Nash: I told the House just over £60,000. Mr. Hamilton: You don't want any suspicion about what you paj^ for a thing. When I was Minister of Broadcasting and we bought the broadcasting station we came straight away and to'ld the House about it, being glad to get rid of it as early as possiblo (laughler), Mr. J. G. Barclay said the leader of the Opposition had'criticised the graduated land tax as unjust, but a commission had been set up to deal with two or three per cent. of losses where injustice had occurred. The tax could be justified a hundred per cent. and the bulk of it was paid in the eities. At this juncture Mr. W. J. Broadfoot rose to a point of order, drawing attention to the fact that there were only 14 members in the House and the iells were rung until the required number resumed their seats to make a quorum. Resuming his speech, Mr., Barclay pointed to the fact that even after the ringing of tlxe bells there were still only three members of the Opposition in their seats. Mr. Barclay continued that the present Government was spending tho money it borrowed more wisely than any previous Government had done. Tho Minister, he said, had dealt with the farmers both generously and fairly. How much control had the farmers over the marketing of their produce in. the past, be asked. Farmers put their milk or cream cans outside their gates and a mijk lorry came along and collected them. ■ They had no more say in the marketing of their produce then than they did now, but to-day they wero getting a much fairer deal than they were in the past. Mr. W. J. Broadfoot said Mr. Barclay 's contention that tho farrner previously had little control of marketing his produce was a poor compliment' to tlxe wonderful co-operative system which had done so much to build up the daix-y-ing industry in the Dominion. The Minister 's statement regptrding orthodox borrowing did not square with other statenxents from his party though he thought these were intended to please the monetary reformers. The committeo to investigate hardship in connection with the land tax included two officers interested in maintaining revenue and only one with judicial experience. The necessity for the graduated land tax to break. up large estates had disappeared. The debate had not concluded wher the' House rose at 10.30.