The Guardian And Evening Star, with which, is incorporated the West Coast Times. SATURDAY, JULY 17th., 1926.

Hokitika Guardian, 17 July 1926, Page 2

The Guardian And Evening Star, with which, is incorporated the West Coast Times. SATURDAY, JULY 17th., 1926.

THK FINANCIAL DEBATE. Like the financial statement itself, the deate on the Budget was brief, and haivng regard for the cost of conducting Parliament, acceptably .so. The Budget was disposed of in two nights, which is something of a record. It. would appear that the break down of the debate was lather accidental as no doubt other speakers wished to air their eloquence, but in particular the country would have desired to have heard Sir Joseph Ward, FnfortuiuiteIv for some reason not at present clear, the member for Invercargill did not speak, a fact in view of the special importance of the occasion, which is to he regretted greatly. The speakers being few in number, the criticism was limited. But the remarks were the more directly in a fiuancal view. The speech by Mr Forbes was commendably comprehensive, and certainly fair. He reviewed the facts of the position particularly in regard to election promises and Budget performances, and was able to show up many discrepancies and certainly the absence of a forward movement as a defined policy. It is rather significant that the Minister of Finance in his reply, confined himself to answering Labor criticism, "'herein there was the opportunity for the two quoque argument. Mr Holland’s attack on tlie’gift of the battleship New Zealand was a. loop-hole for the Minister and lie took advantage of it. Of all the British Navy there were few capital ships in the Great War which saw as much spectacular service as the New Zealand, and on each occasion the battleship justified her presence. The war service of the gift ship was indirectly a complete vindication of Sir Joseph Ward’s foresight in.

arranging for the gift of the battleship—but strange to relate lie lias never received generous appreciation for his outstanding political action. Harking ack to the Budget itself, its high finance is the most important aspect, and we do not know that the critics made the most of the matter. The Financial Statement disclosed that last year the country borrowed over eleven millions, and had a surplus in excess of a million. The latter was regarded as a. very satisfactory result indeed, hut the borrowing proclivities of the

Government do not appear to have caused much real anxiety. Mr Forbes drew an interesting analogy on the subject. “I look to New Zealand in much the same way as I regard a farm,’ said Air Forbe.s. ‘‘When we increase the mortgage on the farm by £11,000.000 we are increasing it by a tidy sum.” He was not going to say that good arguments could not he given for increasing the public debt. Every farmer who increased the mortgage on his farm could find son for doing so. The question was: Can we go on borrowing at such a high rate? It did not matter that borrowing was necessary. AVe had to consider whether the country could stand

it. That is the aspect the Budget did not probe deeply. With so much money floating about, even to the extent of the surplus, the Finance Afinister was not able to reduce taxation. Air Dowuio Stewart, however, proposes to hold Hi? hand with regard to borrowing. His

reason for doing so is not so much the growth of the public debt, as the cost of the money. Money is dearer, and Mr Stewart prefers to wait for cheaper money! Money borrowed earlier at low rates of interest will be falling due in the near future, and it can be replaced only by money at a higher rate of interest. The Government offers no policy to meet the stringent position, which will result by the check upon the prosecution of development works at present being carried on out of loan money. There is no suggestion for improved trading by increasing production. On the contrary, as a contemporary puts it. the chief friends of the Government favor a limited output, and big prices, just as Labor favours short hours and high wages. There lias got to be developed in New Zealand a political policy which will save the situation brought about by a conservative form of administration. It had to be done before, and history has the knack of repeating itself—particularly in the political arena. The caution the Government proposes to exercise so late in the day regarding further borrowing should be supplemented by general economy in the public administration so,that Mew Zealand will not be over-ridden nor over-burdened with its civil service. There must be a revival of the land for settlement policy and the willingness to aid trade development. All industrial effort should be stimulated where it is possible to expand trade, and so far as the timber industry in this district, is concerned much can be done to aid our most important industrial activity. New Zealand is capale of bolding more than its own if given a fair chance. There is too much restriction on trading, too much government by regulation. Mr Coates promised there was not to he so much Government in business, and the time is over ripe to discharge that promise. At the same time the fillip to industry and production,, which would result would be a very special help to the financial position of the country, and go a long way towards relieving the stringency that is unfortunately in sight.