LABOUR PARTY'S PLAN

Rotorua Morning Post, Volume 1, Issue 23, 19 September 1931, Page 5

LABOUR PARTY'S PLAN

("Post" Special Commissioner.) .

MR. HOLLAND AND COLLEAGUES ' SUBMIT MINORITY REPORT SHORT MORATORIUM SUGGESTED " -. CENTRAL BANK, LAND SETTLEMENT AND LOANS TO INDUSTRY In ihe Hoisse of Representatives yesterday, after the Prime Minister had made his annouacejneat regardjng the decision to form a Coalition Gov erninent, Mr H. E. Holland, Leader of the Labour Party, obta'.ned perm'ss'on to discuss the sittings of the inter-party eco loray committee. Mr Holland submiiiezi a long and pomprehensive statement of his Party's views on the Dominion's .economjc posjtion, including plans for financial re jabilitatioa, prepared as a minority report by the Labour -rnem bers of the comm-ttee.

WELLINGTON, Friday Raising a point of order in the House of 'Representatives this afternoon after the Prime Minister (the Rt. Hon. G. W. Forbes) had made his announcement of the decision of United and Reform Parties to join forces in the formation of a Coalition Cabinet, the Leader of the Labour Party, Mr H. E. Holland, asked permission to move the ad journment of the House to enable the sittings of the inter-party economy committee to be discussed. The Prime Minister said he had no objection and there was loud laughter as Mr Forbes, by a slip of the tongue, addressed Mr. Holland as Leader of the Opposition. Mr Holland said the most extraordinary position had been reached so far as the economy committee was concerned. He made it pla'n that the Labour Party would oppose any adjournment of the House, but the Labour Party had agreed that the position of the country should he" considered. Labour's viewpoint was that there should be no postponement of tne General Elections, Mr Holland continued.- It was a serious thing to disfranchise the electors in a serious position like the present. If they took away the right of the people to make a change and set up a political dictatorship, they would encourage all the elements of an insurrection. Evidence given to the committee, Mr. Holland said, had been of an economic character, although if some of the recommendations were carried out they would be bad for the country and the people. Mr. Holland mentioned that a few days ago the Prime Minister had declared that before any drastie action was taken there should be a postponement of the. elections. The Prime Minister had. been obviously afraid of the attitude of the electors. The Government had had no definite proposals to offer to meet the existing position. On Wednesday Mr Forbes "had announced that he would not "permit the committee to proceed further unless an agreement was reached concerning the formation of a National Government and a postponement of the general eleetiotis, but he undertook to confer with his Party in the matter. Yesterday there was no meeting of the committee and to-day the Prime Minister told the committee that negotiatlons were proceeding between the Government and the Opposition. Mr. Holland said that a fusion of any two of the Parties in the House could be no concern of the economy committee and no arrangement between Parties should have interfered with the work of the committee. No Finality As a result of the Prime Minister's action, Mr. Holland continued, the committee had come to no finality and all that they .had was a mass of conflicting evidence. The Labour members of the committee stood alone in making definite proposals for the consideration of the House and he proposed to lay before the House the opinions of the Labour Party. They were unable to agree to the proposals laid down by the other

A report had been prepared by Labour members of the committee which stated that the Labour members had found themselves in general disagreement with the other members on the vital question of whether or not 'they should pursue a pulling down policy, which at best could not be made equitable in its incidence, as against a policy of reconstruction, which would give encouragement to the people and enable them to en-

joy a reasonable standard of living. "We held that only by a bold policy of industrial developinent could the people be put in a position to meet their financial obligations, a large amount of which could not he modified by any policy the committee could recommend," stated the report. "We strongly expressed the opinion that the State could not go on indefinitely increasing taxation without at the same time adding to the sources from which taxes are drawn. We stressed the fact that while the present negative policy is being pursued, wealth in all its forms is rapidly disappearing and a large proportion of the people are being reduced to a state of penury and want.

Striking Contrast "In striking contrast to witnesses who advocated cuts in wages and pensions was the evidence of manufacturers, wholesalers and retailers, who stated that the cuts already made had reduced their turnover and as a consequence, had inereased their cost per unit of output. These witnesses declared that the inereased purehasing power of the community, wage reduetions and unemployment were contributing causes to the present position. "Evidence was also submitted to show that in the cases of the waterside worlcers and the seamen, the greater part of the reduetions in wages -went to overseas shipping interests, to the disadvantage of trade in the Dominion. The economists and the Government Statistician are agreed that our national ineome is not less than £150,000,000 per annum. We think the national income is greater, and regret that through lack of data, the Statistician's office is not able to settle the question. "In view of the comparative failure of the credit system and lack of co-ordination between finance and industry, it is imperative that the State should take a greater part in

controlling the uses to" which credit * and eurreney shqtild .be pqt. A cen•tral bank, which would be under the contT ol of the State, should . he os-.. . tablished for th©,. purpose, this bank ' ' to have the sol.e right of jpote issue. In the meantime, regtilat ons governing the issue of notes hy the private banks should he extended; Fixed Charges "In view of the serious position of many farmers, business .men and others with fixed financial charges in the form of mortgages, chattel securities, leases etc., we recommend that a prpvisional moratorium be declared for the purpose of preventing foreclosure, and that legislation be passed enabling mutual adjustments for a speclfied period of time between* mortgagee and mortgagor, and. between leasee and lessor. If withrn tluce months of the pasE.ing of the eg s at on no agreement has beeh urived at, a 20 per cent. reduction to immediately orerate, the mortgagee or lessor, as case may be, to have the right to appeal to a suitable ttibunal. "This proposal is a natural corol-. lary to the wage and salary- reduct tions. Unless wages a-rid salar ies are restored to their former basis, a reduction in interest; rates is inevitable. Purehasing P.ower and Wages As the effective -purehasing power of • the people, and- eonsequently the local market, ... depends upon the level of income ■ recived by wage and salary earners, reduced wages must result in trade stagnation. Every effoit 'should be made to increase wages with the increasing .volume of production and thus make it possible for production to continue and the standard of living to rise. Unemployment "The only economic soiution of the problem of unemployment is the rehabilltation in industry at rates of wages that will provide ao reasonable standard of living for all who are now unemployed or are working part* time. In the meantime, the Government should make further provislon "o. unemployed out d!f the Consolidited Fund and additional grants should be made to hospital boards for the relief of distress arising from unemployment. "To meet the general situation, it is necessary to organise the whole of the industrial forces of the Dom'nion on modern lines, -and with chis ohject in view we present the icccmmendations which follow: "(1) Careful selection .of suitable men in addltion to those who are ali i eady employed to engage in the ■ work of preparing for immediate settlement, large areas of Cr ov/n and ' other lands, the men taking part in such work and willing to become permanent settlers, to have preference in taking up the land when ready for settlement. "(2) Development of a plan along the lines suggested by the rural economic advisor to the Department of Agriculture for the purpose of improving the quality and number of dairy herds, increasing the output and lowering the unit cost. "(3) A State subsidy for the supply of fertilisers to farmers on the lines suggested by the rural economic advisor.

Secondary Industries "(4) The appointment of an industries development board to cooperate with the Government in preparing a plan for the development of secondary industries, where necessary the State to provide financial assistance for approved industries. "(5) The regulation of the importation of goods, the like of which _ are being produced in sufficient quantities in the Dominion. "(6) Immediate inquiries aboard for the purpose of arranging trade agreements between the Dominion and other parts of the British Commonwealth and other countries in order to increase the market for Dominion exports. "(7) An investigation into the possibility of arranging with the primary producers to co-operate with the Government for the guarantee of a price for primary products based upon the five-yearly moving average. "(8) An extensive scheme of main and secondary highways construction and particularly construction ef roads to backblock districts that are without adequate road access. Highways revenue to be hypothicated for

the purpose of paying interest and sinking fund charges on the necessary loan moneys. The Budget "We agree that it is desirable to balance the Budget, and that the immediate burden should be spread over the community according to their ability to pay. This being so, we are of the opinion that primage duty should be removed, and likewise.that all indirect taxes on foodstuffs and other necessaries not produced in New Zealand. The revenue lost hy the removal of these taxes and sueh other revenue- as is required, should he made up by means of an additional super-tax on the higher incomes and a super-tax on dutiable goods the like of which are produced in New , Zealand. Tax Free Securities "While disagreeing with the majority of the members of the committee on the matter of additional taxation of ineome received from mvestments which are .already subject to taxation, we are of4 the opinion that all investment ineome from ,se7 curities that are now free from taxation should be subject to a special emergency tax, such tax to be on the graduated income tax basis.