OPENING OF PARLIAMENT

Otago Witness, Issue 4033, 30 June 1931, Page 22

OPENING OF PARLIAMENT

HIS EXCELLENCY’S ADDRESS

A COMPREHENSIVE SURVEY Honourable Gentlemen of the Legislative Council and Gentlemen of the House of Representatives: It affords me much pleasure to meet you again at the opening of another session of Parliament. During my visits to various parts of the Dominion since I assumed the office of Governor-General I have been impressed by the deep-seated loyalty of the people of this Dominion and gratified by the kindly welcome to myself. , IMPERIAL CONFERENCE. The deliberations on constitutional questions of the Imperial Conference of 1930 resulted in the preparation of a draft Statute of Westminster to clarify the constitutional position and the powers of his Majesty’s Goverunrents in the United Kingdom and in the dominions. It is proposed that this Statute should be passed by the Parliament of Westminster on the receipt of approving resolutions from the Parliament of each dominion, and a suit able resolution will be placed before you for that purpose during this session. My Prime Minister believed himself to be interpreting the general view on this question in taking the position at the conference that no desire existed in this Dominion for any alteration of its present constitutional position. In view, however, of the general desire of other dominions for- a formal recognition of alterations in their status and of the requirement that the necessary enabling legislation must be approved by the Parliament of each dominion, my Ministers are of the opinion that the best interests of the British Commonwealth of Nations would be served by the approval of the draft Statute of Westminster, which will in any case, notwithstanding such a resolution, have no application to this Dominion until legislation applying it thereto has been passed by the New Zealand Parliament.

The failure of the Imperial Conference to arrive at any effective conclusion on the economic policy of the British Commonwealth, and the reference of this vita) subject to a future economic conference to be held at Ottawa, have given my advisers much concern. The subsequent postponement of this economic conference from the date originally suggested in August of this year until 1932, which will allow more time for the formation of

SPEECH FROM THE THRONE. GOVERNMENT’S PROGRAMME OUTLINED. REVIEW OF ECONOMIC CRISIS. WELLINGTON, June 25. The fifth session of the twenty-third Parliament of New Zealand was opened by the Governor-General (Lord Bledisloe) this afternoon with traditional ceremony. His x Excellency and Lady Bledisloe left Government ■ House at 2.15 p.m. to the accompaniment of a salute of 19 guns fired by the R.N.Z.A. from Point Jerningham. Their Excellencies were accompanied by. the official secretary (Mr A. C. Day), Captain Sir John Hanham and Lieutenant Elworthy (aides de camp). On arrival at Parliament Buildings their Excellencies were received at the foot of the steps by the general officer commanding the New Zealand Forces, Major General Sinclair-Burgess, and Senior Naval Officer Captain Fraser, the opening bars of the National Anthem being played by the Royal Naval Volunteer Reserve Band. His Excellency then inspected the Guard of Honour provided by the Royal Naval Volunteer Reserve under Lieu-tenant-commander Cross. In the meantime her Excellency was escorted to her place in the Legislative Council Chamber by the Clerk of Parliaments, Mr E. AV. Kane, C.M.G., and attended by Mr Day and Lieutenant Elworthy. Lady Bledisloe was presented with a bouquet by the Speaker of the Legislative Council (Sir Walter Carncross), who also presented a bouquet to Mrs Forbes. Members of the Supreme Court Bench, led by the Chief Justice (Mr Justice Myers) were statiotfed on the left of the throne in the Chamber, and seats were also occupied by the wives of Ministers of the Crown and others. A large attendance of the public had assembled in the grounds of Parliament Buildings in bright sunshine, and there were crowded galleries in the Legislative Council Chamber. On entering Parliament House after inspecting the Guard of Honour his Excellency was received by the Gentleman Usher of Black Rod (Mr A. T. Bothamley), who was using for the first time the new black rod presented by Lord Bledisloe. On entering the Chamber of the Legislative Council Lord Bledisloe was accompanied by Major-general Sinclair-Burgess, Captain Fraser, Paymastercommander Webster, Colonel Symon, Colonel Cunningham, Lieutenant-colonel Standish, Lieutenant-colonel Saunders, and Wing-commander Grant-Dalton. Taking his seat on the throne his Excellency commanded Black Rod to summon members of the House of Representatives, who took their seats at the rear of the chamber. The Attorney-general and Leader of the Legislative Council (Sir Thomas Sidey) handed to Lord Bledisloe a copy of the speech which his Excellency then read as follows-. — -

public opinion upon the necessity«of a com mon economic policy among all members of the Commonwealth, is not regarded by my Ministers as entirely- disadvantageous. On May 21, in common with other Governments of his Majesty, my Government notified its adherence to the general Act for the pacific settlement of international convention formulated under the auspices of the League of Nations by which all signatories bind themselves to refer any international dispute that mar arise either to arbitration or to a judicial settlement, as the case may be. DISARMAMENT CONFERENCE In view of the undoubted improvement in international confidence resulting from the increasing acceptance of the general Act and other steps towards the peacefu. solution of international disputes, my Ministers earnestly trust that the Dis armament Conference to be held next year by the League of Nations may result in some general and effective reduction in armaments, which are not only a menace to the peace, of the world but involve a heavy financial burden and are, in the opinion, of my Ministers, a factor in the present widespread depression. WESTERN SAMOA. . In April, 1931, Colonel S. S. Allen re e (? l ie<l h* B appointment as Administrator of Western Samoa and Brigadier-general H. E. Hart was, on the advice of my Ministers, appointed to this post. The marked improvement of conditions in the territory indicates the success of Colonel Allen s administration. TRADE WITH CANADA.

The difficulty of disposing at a profitable rate of the Dominion’s principal products was intensified last year by tariff alterations in Canada, which increased the import duty on New Zealand butter formerly admitted into that Dominion in common with Australian butter, at a rate of one cent per lb to eight cents per lb. My Ministers have, for the past 12 months, been endeavouring to initiate negotiations by which this and other trade questions at issue between the two dominions might be satisfactorily adjusted, but they have been unable to arrange for effective conversations. Thev have, therefore, been obliged to consider whether, in the present condition of the finances of this Dominion, they would be justified in continuing the admission of Canadian goods into New Zealand at British preferential tariff rates, which involve considerable remissions of duty on the entry of Canadian goods, and which

have facilitated an increase in Canadian importations into New Zealand to a value far exceeding that of New Zealand importations into Canada, even during the currency of its maximum trade in New Zealand butter. My advisers have reluctantly been forced to the conclusion that in existing circumstances the benefit of British preferential tariff rates on Canadian goods must be suspended' until arrangements can be made to ensure a more even balance of trade between the two dominions. - Action has been taken accordingly, but the matter is still the sub ject of communication with his Majesty’s Government in Canada.

HAWKE’S BAY EARTHQUAKE.

Prompt steps were taken by my Govvernment to deal with the many problems arising out of the Hawke’s Bay earthquake disaster. Moneys were made available immediately to ensure that proper provision was forthcoming for those in urgent need. A public fund for the relief of sufferers was opened, and a most generous response was made, both in the Dominion and elsewhere. This fund, which is being administered by a Central Committee, is being used for the immediate relief of distress and” the restoration of homes. The rehabilitation of the residential area is proceeding expeditiously, and practically the whole of the fo.rtner population of the devastated area has returned. To assist in rebuild inu the business area the Government has obtained statutory authority to pro vide the sum of £1.250.090 for individuals and £250.000 for local bodies in need of assistance. A Rehabilitation Commission has been set up to consider applications for assistance and to make such recoinmendathns as fit. Many difficult problems will arise in adjusting the rights and liabilities of parties affected by the earthquake. The Government has accordingy set up under statutory authoritv an Adjustment Court, which will have power to determine the questions affecting such rights and liabilities and to make such orders as seem equitable. UNEMPLOYMENT PROBLEM.

In almost every country the depression in trade and industry existing to-day appears to be unprecedented, and in consequence the problem of widespread unemployment has become more acute. The question of devising a practicable solution has been, and is str'll, engaging the close attention of statesmen and economists in all parts of the world. In this Dominion it has been possible under the provisions of the Unemployment Act. 1930. materially to relieve the position, and in co-operation with local bodies and private individuals my Government has succeeded in ameliorating considerably the condition of a large number of persons who would otherwise have experienced great hardship. The Unemployment Board is making every effort to cope with the problem, and as much work as possible is, in addition, being provided on public works and other State activities. It is evident, however, that increased funds must be placed at the disposal of the board, and proposals to this end will be submitted for your urgent .consideration. WAGE AND SALARY CUTS. With the great decrease in revenue, my advisers were reluctantly compelled to impose reductions in the salaries and wages of public servants. The Court of Arbitration similarly decided that the prevailing economic conditions necessi tated the issue of a general order reducing the minimum rates of pay prescribed by its awards. General reductions have also been made by public bodies and private employers. My Ministers are confident that the action that is being taken will result in the retention in employment of a large nttmber of workers who otherwise would have to be dispensed with owing to the substantial reduction in the income of employers, and thus swell the ranks of the unemployed. The spirit of self-sacrifice displayed by all sections of the community is commendable. CONTROL OF THE RAILWAYS. When I last addressed you I indicated the intention of my advisers to submit legislation constituting a board to control the railways and generally to manage the affairs of the Railways Department in accordance with business principles:. Legislation was duly passed, the board has since been constituted, and has now commenced its duties. My advisers are of the opinion that this action will result in improving materially the financial position of the railways, thus promoting the welfare of the Dominion. COMPULSORY MILITARY TRAINING The suspension of compulsory military training due to the necessity for a reduction of defence expenditure enabled many members of the Permanent Defence Force to retire on superannuation under the provisions of the Finance Act, 1930 (No. 2). My advisers have recently approved of the reorganisation -of the Defence Forces on a voluntary basis. The organisation of the territorial force will remain on the divisional basis which has proved satisfactory in the past, and will preserve the traditions of the units. It will provide for the training of approximately 10,000 men. In addition, every encouragement will be given to the training of cadets at secondary schools. The Governments seeks the co-operation of employers in making a success of the new scheme by encouraging their employees to enlist and carry out their training. DISABLED EX-SOLDIERS.

An Act was passed last year to promote the re-establishment in civil employment of disabled ex-members of the New Zealand Forces. Unfortunately, owing to the financial position of the Dominion, it was not possible for my Ministers to make arrangements to give immediate effect to the Act, but the necessary machinery is now being set up which it is hoped will substantially benefit the large number of disabled ex-soldiers who are either wholly unemployed or have no regular employment. WORLD-WIDE FALL IN PRICES. Mr Speaker and Gentlemen of the House of Representatives: The Dominion is still beset with great difficulties. arising out of the world-wide fall in prices. As a direct result, notwithstanding the industry of our' producers, the value of our exports for last financial year amounted only to £39,527,000, a decline of £17,626,000 in comparison with the financial year ended

March 31, 1929. This immense fall (in prices over so short a period has suddenly reduced the productive value of land, thereby placing many farmers in serious financial difficulty. Indeed, it has prejudicially affected the economic position of the whole community and brought about stagnation in business, the most’'disturbing and regrettable feature of which is the want and suffering resulting from thd large increase in the number of persons who are unemployed. Every section of the community, however, is affected, and the problem is one that urgently demands national co-operation in order that the difficulties may be speedily overcome. JI he public finances, although seriously afrected only towards the end of the financial year, reflect the position with a deficit for the year of £1,639,000. which, while regrettable, was. in the circumstances, unavoidable. The full effect of the economic crisis on the nation’s finance will be felt during the current financial year, and drastic measures, involving considerable sacrifice on the ’part of the whole community, are, unfortunately, necessary to enable the Budget to be balanced. As the level of world prices lies beyond our control, iny Ministers are satisfied that the only sound method of solving our local difficulties is to restore economic equilibrium by lowering overhead expenses and the cost of living. Consequent on legislation passed during the last session of Parliament, and with the cooperation of the business community, considerable progress has already been made in this direction. FARMERS’ DIFFICULTIES. Apart from the operation of the Mortgagors Relief Act in preventing special hardship in isolated cases, it is pleasing to record that the difficulties of' our farmers are being largely mitigated bjvoluntary arrangements between the parties concerned aided, in many instances, by the adjustment commissioners appointed for that purpose. LOCAL BODY TAXATION. ' As a further ® means of promoting national economy and assisting the primary producers in particular, it is proposed shortly to set up a Royal Commission to investigate the whole question of the incidence of local bodies’ taxation and the possibility of giving some measure of relief to rural ratepayers by a genera] reorganisation of the system of local government. It is recognised by my advisers that, while it is essential for the national wellbeing that the Budget should be balanced, the burden of taxation should not be unduly increased. Accordingly, an Economy Committee has been engaged for ‘some months past in carefully investigating every item of public expenditure, with a view to effecting all possible reduction. PUBLIC WORKS LOAN.

A loan of £4,000,000 was recently raised in London to provide additional capital for carrying on the programme of publicworks, and a further sum of £1,000,000 to provide for the redemption of certain maturing securities. In view of the unfavourable state of the London money market and the effects of the present high rates of exchange, the issue took the iorm of three-year bonds bearing interest at 5 per cent. THE BANKING SYSTEM. My Ministers recently obtained a report on the banking system of the Dominion from Sir Otto Niemeyer, of the Bank of England. This report will shortly be submitted for your consideration. LAND SETTLEMENT POLICY. Honourable Gentlemen of the Legislative Council and Gentlemen of the House of Representatives: My Ministers have given close attention to the vital question of increasing the volume of the Dominion’s primary products and of providing additional avenues for the employment of labour through the prosecution of an active land settlement policy. Energetic endeavours have been made to bring into production idle Crown areas capable of successful development. As the result of the provisions of the Land Laws Amendment Act, 1929, a large number of sections which had been abandoned by former tenants have been reselected, and numerous sections of virgin Crown land have been taken up. The system of granting financial help to the selectors of undeveloped areas has proved of material assistance to them. The work of developing suitable blocks of Crown land prior to selection is proceeding steadily, and in connection particularly with the development of pumice land my Ministers are pleased to record that the operations already carried out give every promise of success. The acquisition of private. lands for closer settlement has also received attention and almost all the subdivisions offered have been selected. A new feature of this policy has been the purchase of estates which afford scope for development work by the State prior to offering the land for selection. .

My Ministers are confident that by placing large numbers of settlers on the land and providing reproductive employment for many others a substantial contribution will be made towards alleviating the problem of unemployment. NATIVE LANDS. Satisfactory progress is being made in the development of Native lands. At the end of last financial year there were in active operation schemes affecting 20 areas in both islands, while preparations were made to commence others affecting 11 areas. The Maori communities concerned have displayed the greatest interest in the schemes, which by providing much-needed employment on productive work, are assisting large numbers of them’ during a very difficult period. AGRICULTURAL, PRACTICE. Agricultural practice generally i n the Dominion is keeping well abreast of modern methods, based upon the world’s latest scientific knowledge, and the instructional and advisory services provided by the Government are extensively -utilised by farmers in connection with all phases of primary production. It is satisfactory to note that the volume of output has been well maintaned. THE DAIRYING INDUSTRY.

In connection with the dairying industry the continued fall in the market

price of New Zealand cheese has been receiving the earnest attention of the Governmnt. Research is now iu progress,, and its application will, it is believed* lead to the removal of major defects in manufacture and to the production of a high-grade quality which will restore New Zealand-made cheese to the position which it formerly occupied in the British market. An extended trial has been given in recent years to.,the manufacture from high-testing milk of cheese of standardisted fat content. This has proved unacceptable to buyers, and a strong prejudice has arisen against it. My Ministers consider it desirable that the manufacture of this type of cheese should cease entirely, as being calculated seriously to hamper successful marketing and to alienate the goodwill of British purchasers. THE DOMINION’S INDUSTRIES. My Ministers have had under consideration the steps necessary to facilitate the more active development of the Dominion’s industries and their more effective co-operation with the scientific ser-_ vices provided by the State. Proposals for this purpose will be placed before you, including, in particular, provision for a greater measure of specialisation in those departments responsible for scientific research and for closer contact between both primary and secondary industries which they are designed to assist. RAILWAY CONSTRUCTION. The question of the future prosecution of railway construction work in connection with both old and new schemes has been referred for investigation to the Railways Board, whose reports will be duly laid before you. HYDRO-ELECTRIC ENERGY. The construction of the key stations fo.r the supply of hydro-electric energy to .all parts of the country, and their interconnections, will be proceeded with expeditiously while transmission lines will be extended as the demand expands. ROA DING POLICY. The ideal of having a road, capable of use under all weather conditions, from the property of every producer to the nearest railway station or port will still be pursued. While it may not be possible to proceed at the same rate with the programme of improvements which has of late years been followed on the roads, their maintenance, which is necessary to prevent dissipation of capital already expended, will be kept up to the present satisfactory standard. IRRIGATION. Irrigation works to serve the regions in the South Island, which cannot be, otherwise fully developed and utilised, will be continued, as will also other reclamation works involving drainage and river control. ROAD TRANSPORT. The inadequacy of existing legislation to regulate efficiently commercial road transport has been particularly emphasised during the present financial depression, and proposals will be placed before yon with the object of providing suitable administrative machinery with this object, and especially to bring 'about, in the public interest, closer operating relationship vrith the national railway system. The financial loss which has occurred in railway working has been* in a large measure, caused by an overlapping in transport, facilities. The unrestricted use of our road system is continuing to impose heavyburdens on the country ratepayers, thus accentuating their financial difficulties. My advisers are confident that their proposals, which in many respect- have been framed on similar lines to those adopted in other countries, will effect considerable national economies without imposing hardship on any section of the community. EARTHQUAKE PRECAUTIONS.

Consequent upon the destruction by earthquake and fire of the records of the Land Registry offices at Napier, an amendment of the Land Transfer Act will be introduced to provide for the reconstruction of the land transfer register for th’e Hawke’s Bay district. A Building Construction Bill will also be introduced imposing on local authorities an obligation to make by-laws for the design and construction of buildings with a view to securing a better degree of resistance against earthquake. PROPOSED LEGISLATION. Bills will also be laid before you dealing with air navigation, defence, public works, hospital and charitable institutions, rural intermediate credit, trading coupons, the National Provident Fund and other subjects. The various matters to which I have referred are commended to your careful consideration, and I earnestly pray that with Divine guidance your deliberations may promote the happiness and prosperity of the people of this Dominion. • LEGISLATIVE COUNCIL After their Excellencies and party and members of the House of Representatives had left the chamber Sir Edwin Mitchelson gave notice to move the Address-in-Reply motion on Wednesday next. The Council adjourned at 3.20 p.m. until Tuesday next. HOUSE OF REPRESENTATIVES MEMBER SWORN IN. The Speaker announced the result of the Hauraki by-eletion, and the new member, Mr W. W. Massey, was sworn in. Mr A. M. Samuel (Thames) and Mr W. P. Endean (Parnell) acting as sponsors. NAPIER POST OFFICE. Replying to Mr W. E. Barnard (Napier), the Postmaster-general (Mr J. B. Donald) said it was intended to restore the Napier Post Office to its former state. The work would be put in hand by the Public Works Department at an early date. It was anticipated that it would take about 12 months to complete the work. ADDRESS-IN-REPLY. Mr F. Lye (Waikato) gave notice of his intention to move the Address-in-Reply motion. The House rose at 3.55 p.m. WELLINGTON, June 26. The House met at 2.30 p.m.

BILLS INTRODUCED. The following Bills 'were introduced and read a first time: —Currency (Mr H G. R. Mason), Electoral Amendment (Mi C. H. Ciinkard), Divorce and Matrimo nial Causes (Mr H. G. R. Mason); » Gaming Amendment (Mr H. T. Arm strong). Rotorua Borough Reclamation Empowering (Mr C. 11. Ciinkard). Local Elections and Polls Amendment (Mr 11 G. R. Mason). Deaths by Accident Com pensation Amendment (Mr H. G. R. Mason), Crimes Amendment (Mr H. G. R. Mason), Shipping and Seamen Amendment (Mr H. G. R. Mason). IMPREST SUPPLY AND UNEMPLOYMENT. The Imprest Supply Bill and the Local Authorities Empowering (Relief of Unemployment) Extension Bill were introduced By Governor-General's Message, and were accorded urgency. The Prime Minister explained that the. latter Bill extended the period within which local bodies might raise loans without a poll for the purpose of relieving unemployment to July 31 next year. They would still have*’to obtain the consent of the Local Government Loans Board before raising loans. Mr Forbes said the amount of money raised under the Act was £102,533 in ' 1928-29, £120,400 in 1929-30. and £110,150 in 1930-31, a total of £333.083. That had been subsidised by the Government to the extent of £175,102, and by the Unemployment Board to the amount of £63,965.

IMPREST SUPPLY BILL.

The Bill was put through all its stages and passed. Speaking on the motion to commit the Imprest Supply Bill, Mr W. D. Stewart (Dunedin West) said he wished to refer to Britain’s offer to the dominions in connection with debt payments. The offer meant that Britain was prepared to sacrifice approximately £11,000,000 in order to give the dominions the benefit of the movement originated by Mr Hoover. When one considered the tremendous burden under which Great Britain was labouring and the efforts which she was making to restore peace and prosperity it would .be apparent that this offer must have aroused the keenest admiration of all who were watching the position. While New Zealand’s difficulties were great, those of Britain were so overwhelming that it was surprising that she was able to make this offer. Britain was bearing a debt which some European statesmen considered she could not carry. She was determined to repay her debts at 20 shillings in the £, while France was quite prepared to repay hers with the franc at approximately twopence. The amount New Zealand was indebted to Britain when the debt was funded in 1922 was £27,532.164. and it was on that amount, which had now been reduced by us to approximately £24.000.000. that this concession was pronosed to be made. Mr Stewart remarked that it had been shown that of the debt funded in 1922 £1,991.919 was for items other than war expenditure. For instance, it included approximately £1.000,000 which was the balance owing on the warship New Zealand. The Prime Minister had stated Mr Stewart continued, that he had set out to balance the Budget. The position appeared to be that in making his plans Mr Forbes could have had no knowledge of this possible windfall in the form of an offer from Britain. It was true also that he would have been count--ing upon receiving German reparation payments. New Zealand’s payments to Britain in connection with war debts amounted to half-yearly sums of £825.000. It had been pointed out that the first half-yearly instalment had already been paid. Britain’s proposal was to grant a moratorium from July 1 to June 30 next year. If the Prime Minister did not receive from Germany New Zealand’s share of the 'reparations for the year he would go short of £270.000 after July 1. The point he wished the Prime Minister to consider was whether he would be prepared to ask Britain to postpone New Zealand’s payments only to the -extent which Germany was not paying us. but so far as the remaining half million was concerned New Zealand should make payment as usual. He emphasised the extent of Britain’s difficulties compared with those confronting New Zealand, and he also added that, in addition to this aspect, it must be realised that New Zealand’s credit in London would be enhanced if the course he had suggested were adopted. It had become apparent that our credit had suffered as the result of our association with Australia. “Just as America has made a gesture to Europe and Britain has made a gesture to the dominions it is possible for Us to distinguish ourselves by saying we don’t wish to imnose greater difficulties on Britain at the present time,” Mr Stewart stated. This would undoubtedly improve our credit and anything that had such an effect would be of immense advantage It all depended whether the Prime Minister could see his way to inform the British Government that while he was grateful for the. offer he had no wish to take advantage of it beyond the extent to which the Dominion ■ would suffer as a result of not receiving German reparation payments. He considered that such a course would clearly dissociate New Zealand from the neighbouring Commonwealth; and he thought the people of the Dominion would realise that the effort was worth making. Mr Stewart remarked that he was pleased to see that the Prime Minister did not propose to put through any proposals embodying the Niemeyer report this session Ample time should be allowed for the consideration of matters of this nature, more particularly in view of the present very wide discussion on currency reform Continuing the debate on the Imprest Bill, Mr W. E. Parry (Auckland Central) referred to unemployment and the conditions prevailing in the country. He did not think the men on relief work should have to pay the levy. He was not in favour of a flat rate levy and considered it should be altered to a graduated levy with exemption -for all on low wages. Unemployed men were being given work on sports grounds when more productive work could be undertaken. Too much money was being snent on sport in New Zealand. Surely the Government could get to work on drainage and other developmental schemes. , The Leader of the Labour Party complained that the Government had, with-

out the authority of Parliament, imposed very severe “ cuts ” on the civil servants. He referred to the remote allowances for schools and said they had been cut out altogther. Continuing, he said the Department of Health had given authority to dental committees to make a charge for the treatment of children in school dental clinics. No child was to be excluded from treatment through inability to pay. The department had later sent confidential letters to school committees asking them to pay £3O per annum _ towards the cost of the material used ' by dental nurses. This communication also suggested that a charge of five shillings per child treated should be made annually, and that the dental officer should be given a list of the children who had not been paid for and who would consequently not lie eligible for treatment. The new policy could not be justified. Mr Holland said there had never been a suggestion during the la'st session that free Rental treatment would be withdrawn, and the late Prime Minister had promised to give free treatment to all school children in New Zealand.

Mr M J. Savage (Auckland West) referred to the subsidies to hospital boards and said that in the past the House had a say in the estimates of expenditure, but this year the Minister had fixed the expenditure so far as hospital boards were concerned. The unemployment situation was desperate and the Government ap-

peared to be helpless to cope with it. Extra expense had to be borne by hospital boards, but the Minister wanted the boards to. curtail their expenditure. The debate was continued when the House resumed at 7.30 p.m.~ Mr Savage said he could not agree with the opinion expressed by Mr Stewart that it would be wise to postpone dealing with the question of currency. He considered that no improvement was possible if Parliament simply waited for something to turn up.

Mr A. M. Sameul said that while he admired the sentiment expressed by Mr Stewart in respect to war debt payments, he could not agree with the action suggested “It is all very fine to put out a gesture of independence and self-reliance so Ibng as we can back it up with finance. I don’t think our nonacceptance of Britain’s offer would help our credit one little bit.- To my mind, the present economic .position has been •brought about by a combination of circumstances among which improvements, as a result of scientific research, are important factors, but 'in my estimation the greatest factor of all is the question of the repayment of debts incurred during the war.” Mr Samuel said this factor had been the . means of imposing very heavy burdens on the taxpayers and industries. and was keeping out of employment men in Britain, as well as in the dominions. The repayment of debt to America was having a strangling effect on

debtor nations, and at the same time was I strangling American industries as a result of the diminution in the purchasing power of the debtor nations. Gold which had been shipped to the United States was not being re-utilised. It was about as valuable as when it had been in the mines from which it had originally been taken. The offer of the- United States was only a preliminary move in the direction of the modification and the ultimate cancellation of war. debts. America realised that there could not be a return to stable conditions until the purchasing power of the nations became the same as it' had been before the war. Her offer had not been an impulsive one. It had been under consideration for some time, and had been made in the hope that it would be accepted. Mr Samuel went .on to say that if the stabilisation of silver con'd be brought about the troubles of Europe as well as our own would be at an end. The purchasing power of India and China had been re duced by over 50 per cent. While he had been at Home he had had several discus sions with members of the British Minis try on the questions of the repayment of rar debts. He had realised that if Nev Zealand were offered postponement it would be of immense value to the Do minion. He thought that everybody realised that taxation had grown vastly, and the sooner it was reduced the sooner tht country would get back to better times.

The postponement of debt payments would enable this to be done. When he had' read of the British Government’s concession in the direction of postponing the payment of the principal of the Austra lian war debts he had written as ar individual member of the New Zealand Parliament to Mr J. H. Thomas (Secre tary of State for Dominion Affairs)., men tioning that he had been wondering if the same generous treatment would be extended to New Zealand. Mr Thomas had replied stating that the whole question at debt payments was under consideration. “ Now that the offer has been made/’ Mi Samuel continued, “ I trust the Govern ment will accept it in the spirit in which it was made. This country can well do with the postponement of that pay ment.” Mr J. S. Fletcher (Grey Lynn): Is it a fair thing to ask the British taxpayers to bear New Zealand’s burden? Mr Samuel: I won’t say that it is a fair thing to ask them to bear New Zealand’s burden, but- I will say it is a 'fair thing for Britain to help one of her children who has always helped her. He added that if the Government turned the offer down it would be doing a stark injustice to the taxpayers of this country. He could assure the House that New Zealand’s credit was still high in the Old Land. Two main factors which were liable to damage our credit were the pessimistic utterances which were continually being made in New Zealand and the

exa (?l?erated reports which had been cir ciliated in Britain concerning the Hawse’ B Bay earthquake. Mr J. O’Brien (Westland) said that New Zealand as a country had made wonderful progress during the last 10 years No other country had increased its pro duction and its wealth so rapidly, but because of a temporary slump the counttv had been plunged into poverty. He knew that it was necessary to balance the Budget, but up to date the money had been taken from defenceless civil servants and the poorer people. There were no prj--posals to take money from those who naJ it.

Mr D. Jones (Mid-Canterbury) dealt with the importation of barley into the Dominion, and said that if Australia *ere allowed to flood the Dominion with weeds it would place New Zealand in a verv serious position. The : m of the Department of Agriculture was to eradicate smut from the Dominion, and authorities agreed that ts eradication could be made an established fact if a serioqs effort were made. Large areas in Canterbury were being planted with smut-free barlej’. and the importance of this would be realised when it was known that smut could destroy one-third of the barley crop. Mr H. E. Holland appealed to the Minister of Health to reply to the remarks of members relating to dental clinics and to the finance of hospital boards.

Mr Holland proceeded to protest against the Government’s coal importing policy. He said that Mr Veitcb’s statement that the New Zealand mines could not produce all the coal required by the railways was wholly inaccurate. At the moment this statement was made most of the mines in New Zealand were working short time.

Mr Stallworthy said it must be understood that those services which could be provided in prosperous years could not be continued to the same extent in times of depression. 'The economy axe had fallen on tlie-Ttental clinic services as well as others. They were still being carried on at remarkably cheap rates. Co-opera-tion was being nought with a view to extending the services to all parts of the Dominion. Replying to references with respect to hospital boards’ finance, he said that if members who had condemning the policy were themselves in the position of having to formulate a policy their criticisms would be tempered with more fairness. It was purely a, question of tbe economic situation.

Mr Veitch, replying to Mr Holland, said the Railways Department had recently allowed its normal supplies of New Zealand coal to go towards meeting the extraordinary demand for coal suitable for the manufacture of gas. It was neces sary to make up the shortage by importation from Australia.

WELLINGTON, June 27. The Prime Minister, . replying shortly after 2 a.m. to the debate on the Imprest Supply Bill, said that, unfortunately, the financial position of New Zealand would not allow the Government to adopt the course it would have preferred with respect to Britain’s offer to suspend repayment of the war debt. It had to be considered that the Government had a programme of taxation before it, and needed every shilling. It would have been a verv fine thing to have taken the stand suggested by Mr Stewart, and he was sure this would have been in accord with the desire of the people of New Zealand, had circumstances permitted it. However, the Government had replied to the communication from the British Government, stating that it agreed' to the proposals in respect to reparations, and gratefully accepted the magnanimous offer of the British Government to suspend for 12 months, from July 1, all payments owing by the New Zealand Government to Britain. Mr Forbes explained that this would mean that New Zealand would not receive the remainder of the German reparations payments for the present year. It had already received £83,000, and it would not receive the remaining £250,000 it had been anticipating. New Zealand had paid, up to July 1, as the half-yearly instalment on the British war debt, the sum of £790,000. By the suspension of the payments after July 1, and allowing for not receiving £250,000 German reparations, there would be a net saving of £540.000 in the present financial year. There would also be a saving of £680,000 next financial year, assuming that reparation payments were resumed in Avgust. 1932. Mr Forbes remarked that Mr Hoover’s offer was a very fine gesture, and was bound to have a favourable effect throughout the world. This gesture had been passed on to the dominions by Britain, with the object that full benefit of the movement should be obtained. The Bill was put through all stages and passed. UNEMPLOYMENT RELIEF. Replying to Mr Coates, Mr Forbes said amendments to the Unemployment Act would be introduced on Tuesday, and would be the next business before the House. It might be necessary to adjourn the debate on this matter to enable members fully to consider the Government’s proposals. In that case, a start would be made with the Address-in-Reply debate. The House rose at 2.25 a.m. till 2.30 p.tn. on Tuesday.