FIVE MILLIONS TO SPEND

Sun (Auckland), Volume III, Issue 737, 9 August 1929, Page 10

FIVE MILLIONS TO SPEND

LAND SETTLEMENT AND UNEMPLOYMENT A FUTILE SCHEME (Written for TIIE SL AV Party leaders usually find themselves in power because the countrywants a change of Government: to get into office they make all kinds of pretensions and put forward a medley of proposals commonly called a party platform. If all these promises could be forgotten the day after the election. it would be a good thing for the people who tote to get rid of a Government for whicn they have no further use. Unfortunately the verdict is interpreted by the new- crowd as a mandate to give effect to all the wild schemes they dangled before the electors prior to the polling. When the United Party was appealing for support, its candidates talked a lot about land settlement; and Sir Joseph Ward in his Budget has outlined a proposal to borrow £5.000.000 for the purpose of providing a large number of persons with farms. No doubt he is quite sincere in his utterlv mistakeu belief that “neglect to foster land settlement is the cause of the Dominion’s present unemployment difficulty”; but the practical considerations involved in borrowing £5,000,000 to purchase estates for subdivision and to develop virgin land are so serious that members of Parliament should pause before authorising- it. a Losiyg proposition’

The Auditor-General’s report placed before Parliament this week shows that the Government has lost over seven millions of money in the past two years as a result of its efforts to convert unemployed soldiers into farmers. The only thing really certain about spending five millions of borrowed money- on land settlement is that it will auu approximately £250,000 a. year to the interest charges for which the taxpayer is responsible. No practical farmer will believe for a moment that it is possible for Government officers to go into the laud market today and buyplaces that will show a clear return of 5 par cent. after providing the farmer a decent living and meeting all legitimate farming costs. Many men now on the land cannot earn 5 per cent, on the capital value of their places and it will take a much abler man than Mr. Forbes to buy and subdivide estates on terms that will preclude losses to the State. Aloreover, owners who can oe tempted to sell appear to have seen Mr. Forbes comi*g with the Government’s five millions, aud the Minister complains rather bitterly that they are asking prices which cannot be entertained. There is ample statutory- authority at present for expropriating existing owners of land, which may- be required for subdivision in the interests of closer settlement, but the Government has never obtained any very cheap land by this method iu the past, and despite Sir Joseph Ward’s threat to arm himself with additional legislative authority, it is not likely to do so in the future. Compensation Courts have always protected owners from anything in the nature of confiscation, and no minority Government such as Sir Joseph Ward's is likely to obtain from Parliament powers to expropriate owners without adequate compensation. ■ 1 QUACK REMEDY

Looking back over a period of some 35 years one finds that Government subdivision schemes to bring about ; closer settlement have provided 7.000 i persons with farms at an average cost of £2.000 each. Much of this land ! was settled when values were far lower than they are today. The operations were carried out on a' rising I market so far as the price of products yvas concerned, hence their success. To repeat the operation at todav’s values and having regard to the uncertain outlook regarding prices is hazardous in the extreme and fraught with grave risk of losses to the taxpayers. As a panacea for existing unemploy- i ment, land settlement is a quack ; remedy which can have little or no ! effect on the disease it is supposed to ' cure. It is only necessary- to look at the ! unemployed to see this. It is stated that some 5.000 persons are on the I registers of the Labour Department ' as out of work, and in all probability i there are 10.000 throughout the Dominion who lack a useful job at the present moment. The majority consists of penniless labourers, some of them work-shy. others willing enough to do labouring jobs under direction, but not one in 100 would be eligible : for a land ballot for farms costj n*■ from £2.000 to £3.000. or is capable of farming one of these holdings successfully. L.WU TfVXGRR M’PEASRD Til the early- day-s of land settlement we used to hear much about “land hunger, and the object of McKenzie’s land settlement. scheme was to give practical men who had saved a little money the opportunity- of acquiring farms of their own. One doesn't hear much about “land hunger" now, because any man who has a little capital and wants to go farming has no difficulty in buying a place on fairly easy terms. The surplus of unskilled labour in New Zealand today- will not be absorbed by investing five millions of borrowed money to create some 2,500 new farmers, who will not employ I mu eh labour, although the settlement of these men will make some vacan- ; eie.s that may be filled by some of the j workless. A forward move in developing iui dustry would absorb much more labour than Sir Joseph Ward's land settlement proposals, which, if successful. wHI not return much more than bare interest on the money borrowed. Five nrilliou potmds invested in industry ■ would employ more than twice as ! many breadwinners as an' equivalent ! sum invested iu land. Also five millions in industry is expected to show a taxable profit of £500,000. of which the Government would take £125,000 in income tax. leaving 5 per cent, for interest and 2J per cent, for reserve. Unfortunately Sir Joseph Ward betrays not the slightest interest iu developing industries which offer far better prospects than we can ever expect from land settlement. Bor- : rowing to increase the meat and butter | export, aud speuding the proceeds from tlm sale of these products on imports, will never solve the unemployment problem, and the politicians who say that it will are merelv deluding themselves and the people thev are trying to serve. PETER SIMPLE.