QUESTIONS FOR CABINET

Hokitika Guardian, 19 January 1931, Page 5

QUESTIONS FOR CABINET

ECONOMY PLANS.

FEARS OF STAFF AND SALARY CUTS.

WELLINGTON, January 16

There is an uneasy feeling among j public servants in Wellington that- the Government’s economy measures will I shortly make themselves felt on salaries and staffs. The special committee of Cabinet which has been sitting daily since the holidays has,. it is reported, come to the conclusion that small economies in expenditure cannot make themselves sufficiently felt in the face of a decline in revenue worse than was anticipated in Mr Forbes’s Budget,

which predicted three millions’ deficit unless the taxation programme was approved and heavy cuts were made in the estimates.

Drastic Economies.

Parliament did what was desired but the revenue became worse than the modest Budget estimate, with the result that the Prime Minister, on his arrival, will have to consider recommendations for drastic economies. 1 The financial burden of unemploy-' went relief is increasing, and although no appropriation was made in the current estimates towards a State subsidy on Unemployment Board expenditure, it is already evident that this charge, must he substantial, and may make all the difference between ft credit or debit balance on the country’s accounts, at the end of March, ' - " Cabinet may be obliged to make a difficult decision regarding curtailment of staffs in the railways and other branches of the public service where it is known over-staffing exists, and there is a fear that thet whole public service may be asked to suffer a reduction in salaries, the hardship of which would be considerably modified if food prices continue their downward course.

Rationing of Work.

There has been considerable activity in the direction of providing alternative employment for a number of public works men formerly engaged on the four lines now suspended. Cabinet’s problem, however, does not cease witTj these lines, as there might be necessity further to consider railway construction with a view to another curtailment. It is also possible that after the Prime Minister’s return Cabinet will consider the rationing of Public Works employment, as it is felt that while many hundreds of men taken from the unemployed ranks have enjoyed a long spell on relief works they should give place to their less fortunate colleagues, who have had no such opportunities.

The Financial Position.

Revenue and expenditure figures for the third quarter of this financial year are being completed this week, and will, it is expected, corroborate the suggestions made above that the position demands considerably more than small economies, and calls for drastic cuts in the hope of balancing the accounts on March 31 and providing some chance for reduced taxation next financial year.