HIGHWAYS FUND PROPOSALS

Sun (Auckland), Volume IV, Issue 1054, 19 August 1930, Page 14

HIGHWAYS FUND PROPOSALS

REFORM LEADER ATTACKS BILL GOVERNMENT AND LABOUR DEFENCE FE proposals contained in the Finance Bill regarding the Main Highways Fund were discussed in great detail and with some heat in the House of Representatives yesterday. The Leader of the Opposition, the Rt. Hon. J. G. Coates, who opened the attack, said that the people had never expected to be “diddled” out of £220,000 a year. Labour’s point of view was given by Mr. M. J. Savage, who criticised Mr. Coates’s attitude. Mr. David Jones (Reform —Mid-Canterbury) fired another shot for Reform and the Minister of Lands, the Hon. E. A. Ransom, championed the Government. Finally, early this morning, just before the House rose, the Prime Minister spoke again on behalf of the proposals.

MR. COATES’S OPINION ‘DISHONOURING AGREEMENT’ “DIDDLING” THE PEOPLE THE SUN'S Parliamentary Reporter PARLIAMENT BLDGS., Monday. That the Government was dishonouring an agreement honourably made was the contention of the Leader of the Opposition, the Rt. Hon. J. G. Coates, when commenting in the House of Representatives today on the proposals regarding the Main Highways Fund in the Finance Bill. When it was decided to pay certain *ums over to the Main Highways Board, said Mr. Coates, it was calculated and decided that those sums were quite a fair contribution from the Consolidated Fund. The Government was now* proposing to destroy that arrangement. The Prime Minister, the Hon. G. W. Forbes: Wo are not doing away with it. That was what the hon. gentleman was telling the country, Mr. Coates replied, and the public was believing it. The Government intended to charge interest on the £1,226,000 which had been given to the roads of the country and that would mean another £61,000 out of the pockets of the taxpayer. Mi*. W. J. Poison (Independent— Stratford): That will increase each year. Mr. Coates: Certainly. Mr. Forbes: That is not interest. That is sinking fund. “Interest and sinking fund,’* Mr. Coates said. Where would the country be if it was not for its roads? he asked. The Government was asking the primary producers to find money from another source. In addition to that the Government had another startling proposal -which could only be termed a steal. That was the £220,000 which would not be paid in subsidies. It was a question of sufficient importance to require the opinion of the electors of the country. A party 26 strong with the assistance of the Labour Party was going to reverse a piece of legislation which had been in force for 40 years. No one w*ould be foolish enough to suggest that the people of New Zealand ever expected to be “diddled” out of £200,000, he added. Mr. Forbes: We are raising the money for it. Mr. Coates: Tou say that the Government is paying for it. The general taxpayer is not paying for it. The extra twopence wdll pay it. Mr. J. McCombs (Labour —Lyttelton) : Who imposed the petrol-tax first ? Mr. Coates: The Reform Party. Mr. McCombs: For the same purpose. The money was to come from the users of motor-cars and the farmers, Mr. Coates said. The Minister of Lands could not have designed the Bill, he continued, because he talked with tears in his voice and almost in his eyes about the unfortunate backblocks farmers. The Minister of Lands, the Hon. E. A. Ransom: You threw out the extra penny which was to go to the backblocks. Mr. Coates: Thank you for nothing. Js every man who owns a car to pay for back-block roads?

“GIFT TO OIL COMPANIES”

UNITED COUNTER-ATTACK MR. RANSOM DEFENDS BILL THE SUN'S Parliamentary Reporter PARLIAMENT BLDGS., Monday. The Minister of Lands, the Hon. E. A. Ransom, appeared in the role of champion of the Government in the House this evening, when he replied to the Leader of the Opposition, the Right Hon. J. G. Coates, in the debate on the second reading of the Finance Bill. He took Reform to task, and claimed, in respect of the accusation that the Government was dishonouring the agreement about the highways funds, that Parliament was not bound by agreements. He said that Reform, by blocking ehe extra penny on the petrol tax, had robbed the settlers in the country, and had given £135,000 as a present to the great oil companies of America. The House had been told, he said, that the Government had repudiated the agreement. Parliament, however, was not bound by any agreements, and the Government had little knowledge of any agreement that might have been made between the previous Prime Minister and the Highways Board. Parliament was bound only by its acts. The Government had found that the expenditure on the roads had grown so much that it had to do what should have been done years ago, and place the responsibility on the users of the roads. Since the first sum of £200,000 Avas made as a grant for road-making, the expenditure on roads had grown to £600,000. When the Highways Board had first been constituted, £35,000 had been given from the Consolidated Fund as a national charge, and £200,000 as a grant, and then the board received revenue from the tyretax and licence fees. Subsequently, with the growth of its activities, it was decided to add the petrol-tax, which last year had realised £BOO,OOO. The Government should have relieved

the Consolidated Fund of the big highways burden that was placed on it at a time when no hardship would have been imposed on anyone, but this was not done, and now it was found that more was being spent from the fund than the country could bear. Local bodies had been faced by expenditure they could not afford, and they did not like to rate for the money, and most local authorities found themselves no better off. even after the roads had been built with Government assistance. Although there Avere fine roads in New Zealand, the county ratepayer found himself no better off. Mr. W. Lee Martin (Labour—Raglan) : He’s worse off. Mr. Ransom instanced the big rise in county rates collected between 1914 and 1928, and said the increase Avas entirely due to motor traffic and the increased expenditure on country roads. Therefore, the user of the road should pay. It had been stated that 26 Government members w’ith the Labour Party, Avere going to undo Avhat had been in existence for 40 years—the subsidy on local body rates. This was not so, because local bodies would still get £200,000 subsidy, which Avould be paid from the Main Highways Fund in the same proportions as previously. However, it was not a question of a party doing anything but of a majority of the Members of the House deciding on what was best in the interests of the country. GIFT TO OIL COMPANIES Mr. Ransom hoped the Opposition would not do what it had done in the Customs Debate, when out of sheer cussedness —perhaps he had better not use that word—out of sheer delight in opposing the Government it had raised such a strong objection that it had deprived the country settlers of £135,000 a year through the petroltax and had made a present of the money to the big oil companies of America. Labour (loudly): Hear. Hear! Mr. Ransom said he believed that an investigation should be made in New Zealand into the price charged for petrol by the companies. Mr. Coates, went on Mr. Ransom, had said that tears had run down his (Mr. Ransom’s) face when he described the lot of the country settler. While that might not have been so, certainly Mr. Ransom felt a great sympathy for the settler. He had travelled with Mr. Coates through the Kaipara electorate and had gone over some of the worst roads in New Zealand. There he had determined that money should be made available for metalling those roads, but the settlers had been robbed of the money which had been given as a present to the oil companies. Mr. Ransom criticised Mr. Jones’s statement about the burden of taxation being put on motorists and ratepayers and said that Mr. Jones surely knew’ better than that. The statement was wholly incorrect and grossly exaggerated. “WRONG POSITION WORSE” PRINCIPLE CONDEMNED BY LABOUR REFORM OPPOSED. HOWEVER THE SUN'S Parliamentary Reporter PARLIAMENT BLDGS., Monday. Labour’s point of view was voiced by Mr. M. J. Savage (Labour — Auckland West), who criticised Mr. Coates’s attitude. The Leader of the Opposition, he said, had said that the Government was removing something that had been law for 40 years in its Highways Fund proposals, but the Reform Government had been in office 16 years and there was no reason to suppose that all the laws it had worked under were right. Quoting from the 1925 Budget he said that the Reform Government had known of the trafficking that had been going on in land. It had proposed to increase the conveyance-tax. What was the object, he asked? There were a lot of proposals regarding stamp duties in the Bill that were like plasters on a wooden leg. They would do neither good nor harm. He had never believed in the petrol-tax, but as the country had the tax it would have to put up with it. Under the bill, the allocations of the boroughs had been decreased, but the amount they Avould receive would be increased. They Avould not lose anything. A Member: They will have to pay more. They would have to pay more, Mr. Savage replied, but the Reform Party had started making them pay. The United Government was only making a wrong position worse. He did not see anything wrong about the broken agreements mentioned by the Leader of the Opposition. People had voted for a change and they were getting it. They might not be getting the change they voted for, but it was clear that they were not satisfied with what they were getting before last General Election. What was required was definite information about what the boroughs and counties would get.

FURTHER REFORM ATTACK MR. DAVID JONES’S SPEECH “WORSE THAN REPUDIATION” THE SUN'S Parliamentary Reporter PARLIAMENT BLDGS., Monday. A scathing condemnation of the Government's proposals in connection with the transfer of Main Highways Funds was uttered by Mr. D. Jones (Reform —Mid-Can-terbury) in his speech on the second reading of the Finance Bill today. He said the action of the Government in charging the interest on the grants already, made was worse than a repudiation of the debt and woree than the repudiation of the leases in Queensland. “The Main Highway proposals,” he said, “carry out the decision of the Government to unload the whole of its liabilities in connection with the public roads of the Dominion (which are the

property of the CroAvn) on to the local bodies and motorists. The Government proposes to take aAvay £226,000 of the subsidies to local bodies which have been in existence for nearly 50 years, and also to refuse to pay the £ 35,000 maintenance charges Avhich were agreed upon by Act of Parliament. In tho Highways Act, 1922, the State undertook to contribute £200.000 annually from Public Works expendi- i ture on condition that the Highways Board took over all roads that the Public Works Department was maintaining. This Avork had been actually costing the Public Works nearly £300,000 a year. In this Bill the Government refuses to pay the £200,000 a year laid down by the Act. “WORSE THAN REPUDIATION” “Regarding these sums, amounting to £461,000 a year, which are the Government’s definite liability, the Government is now passing an Act exempting it from payment and putting the AA'hole of the burden on to the ratepayers and motorists. In addition to this it says it will now charge interest on these past grants, which amount to £1,266,000, and which Avere definitely given to the Highways Fund by Act of Parliament. This interest will amount to more than £60,000, and is far worse than an act of repudiation of the debt. It is Avorse than the repudiation of the leases in Queensland, which had the effect of closing the London money market. “Most of these proposals were brought down last session, but the injustice of them became so evident that Sir Joseph Ward was forced to abandon them. Tho Bill proposes to add to the annual burden on the ratepayers and motorists by £522,000, and a further 2d additional a gallon on the petrol. In the allocation of the neAV petrol-tax the cities and boroughs are not to receive one additional penny. They must pay the whole of the additional petrol-tax, less their Government subsidies, and receive exactly the same amount that they receive today from the petrol-tax. The proposals strike at the foundation of the Main Highways Act and place a direct financial burden on the ratepayer and motorist of an unprecedented amount, and tho House should resist the proposals to the utmost limit. “BETWEEN THE MILLSTONES” “The object of the Main Highways Act was to maintain the roads and relieve the ratepayers of what was becoming a crushing liability. This amendment will place the ratepayer—the county ratepayer particularly—between the upper and the nether millstones. The Government tries to confuse the issue by saying, 'We are giving you back this money through the petrol-tax.’ The Government is not paying the ratepayer in another Avay Avhat it has deprived him of, because the additional petrol-tax is paid by the consumer and then handed back to him. It’s like feeding a dog with a piece of his own tail.” The Minister of Internal Affairs, the Hon. P. A. de la Ferrelle: Would the hon. gentleman agree that 90 per cent, of the petrol-tax is paid for in the cities. Mr. Jones: It may be bought in the cities, but it is not used there. MR. FORBES IN DEFENCE “NO GROUND FOR COMPLAINT” Press Association PARLIAMENT BLDGS., Today. Replying to the comments aroused by the proposal in the Finance Bill regarding the main highways funds, the Prime Minister, speaking at two o’clock this morning, said there had been a good deal of criticism of the proposals. With regard to ths Highways Board, he submitted that if the Government had discontinued its payments to the Highways Board, and made no provision for road construction, there would have been ground for complaint, but it had made such provision and the money for the purpose was being obtained from the additional tax of 2d on petrol. He contended that when the arrangement had been made with motorists regarding the Highways Board grants it had never been expected it was to continue, irrespective of the state of the finances of the country in the future. As a matter of fact, he considered the time had come when the question of the Highways Board should be reviewed. It was his intention either before or during next session to submit the whole question to the Public Accounts Committee of the House, to ascertain Avhether the present system of highways taxation could be placed on a more satisfactory basis. The finances of the country appeared to be getting into an unsound state when complaints were being made that there Avere certain funds on which no one must lay hands.