BUDGET DEBATE

Hokitika Guardian, 15 November 1933, Page 5

BUDGET DEBATE

EXCHANGE RATE

FURTHER DECISION IN HOUSE.

(Per Preat Issociation— Copyritjhl )

WELLINGTON, November 15.

In, the House of ‘Representatives yesterday the debate on the ’ budget wa s commenced by the' Leader of the Opposition (Mr M. J. Savage), who said that the slate of the Dominion’s affa'iA appeared to be getting worse as the years went on. There was nothing in the 'budget to offer encouragement to any section of the community.

’Criticising the increase; in the exchange rate, Mr Savage said that the Minister’s statement i n the budget would. lead one to believe there had been no alternative to raising the rote of exchange. That was far from correct. Not one penny entered the Dominion as an immediate, result of the raising the rate of exchanges. It could i\ot raise. prices abroad. It merely transferred money, already in the Dominion, from one section of tha community-to another.. 'On the Government’s, own showing,, the raising of ihe exchange rate h a d had; for tits object the supplementing of meagre- incomes of a section of primary prndhcers,'andi had been an price levels were net sufficient to maintain a reasonable stand-rd of living “or New Zealand farmers.

The chief effect,of the raising of ‘he pate had been to depreciate New Z ailand’s currency, without increasing it. The Labour the Government should, issue nipre money to put men to. work, at work that was' worth, doing. VVj - 'V ~ Currency, you Id then .not have been depreciated, but : would have been Increased in .volume, and goods would have been increased in volume. , Again, the’ Government cOuld have given'relief to farmers, by direct methods, and it would then have ■: been’ possible' tq deal with vail oases on their merits. 1 . 1 The Hon. Adam Hamilton said the farming community had not asked for advantage over any other section of the community. It ,had >pnly- asked for fair conditions in .the'economic struggle. An investigation of (he position had shown that had not been receiving fair treatment, ‘so far as ' internal conditions were concerned., and the raising of the exchange rate h'd •been one means of assisting them. He, considered, even with the'increased exchange rate, that the .farmers wer-; . still at a disadvantage.. . . . , . Continuing, the Minister said the net increase to the New ' Zealand firmer, in New Zealand, currency, as a r suit of • the twenty-five, per cent, exchange premium, worked out approximateas follows: Butter, 33.6 per e®nt,u ffcsos® |37.2 per cant./ wool 28.7 per cant., lamb 4Q per cent., wether mutt n 46 per' cent., ewe mutton 70 to f 7 per cent., ox beef 47 per cent. He said the reason why the percentage increase was greater tha: the exchange was because the exchange was calculated at f.o.'b. prides, whereat, what the farmer received , was that, price less cost? from the farm to f.o.’b. ’ jit would therefore be seen that the farmer had really gained a better, advantage than wo)ild first appear from the exchange assisance. On. the other, hand the farmer did not have to ' pay the . full twee'y-five per cent, extra tin the added c'st to his imports. Operations here Worked in the opposite way. . The debate was interrupted when the House rose at 10.30 p.m.