PARLIAMENT.

Taihape Daily Times, Issue 220, 4 August 1917, Page 6

PARLIAMENT.

' WAR PURPOSES LOAN BILL. In moving the second reading of the War Purposes Loan Bill in the House of Representatives on Thursday, Sir Joseph Ward said the Bill gave power to raise £24,000,000, .£12,000,000 of which would he raised in the Dominion. About seven months later he proposed to raise the second portion of about £10,000,000. All would depend on how the the money stretched out. Interest would be at 4i, free of income tax. He could not agree to raise the interest to 5 per cent, because that would be unfair to investors in the first loan, who in a patriotic spirit came forward and subscribed so liberally. If this increase took place, then he would have to raise the interest of the first loan to 5 per cent. He was quite satisfied he would get the money at the lower rate, as only to-day he had received offers from two gentlemen of large sums since they saw the statement in the Budget. He had every confidence in the loyallty of the people to rise to the occasion. The Government was determined not to go out of the country for the money, and it was the duty of everyone who had money to do their share, Mr. Massey replying to criticism on extravagance, mentioned the enormous‘expenditure in connection with camps, where it had been determined to spare n 0 expense to keep down epidemics. Then the question of transport arose, and then men had to be maintained in England, where we seldom had less than ten thousand men. Hospitals had to be maintained, to say nothing of the maintenance of the men at the front. It was a mistake to suppose that our men only cost five shillings per day; the cost was nearer I2s per day. He' admitted that there -was waste. He had seen it in France, and it seemed as if it were inseparable from war. Our clerical staff in England numbered 270, but another Dominion had a staff of three thousand. The Government had been accused of refusing information. That was not so. They were willing to give .all possible information, and if any members had specific instances of waste he w r ould be glad if they would bring it under the notice of the Government. He claimed that we wore now conscripting wealth by means of the income tax. Any ether method would do the greatest harm to the credit of the Dominion. If one man was forced to give up to 25 per cent, of his capital, then it simply meant that he would have to push someone else, and so the thing would act and react until the whole credit of the country would fall to the ground. Many could not be got from the banks by the wealthy because if everyone was asked to pay out to the Government at once, the banks could not possibly lend enough to all, and financial, chaos would be the result. His endeavour had always been to keep the country prosperous, and while conscription of weath was a very attractive theory, he was confident it was impracticable. He believed money could be got at a flat rate, but it would bo at such a rate as would raise the rates to other borrowers. He did not

know when the war going to end — possibly a year from nowi—but as soon at the end came the extreme rate of income tax would cease gradually. The reason and the only reason, that interest was being exempted from taxation was that the Government felt that money could not be get on other terms within the Dominion. They might go outside, but he did not know where, unless to Britain. The Government knew that the Imperial Government had their hands .full They were doing their share, and we must do our share. There had been criticism of the National Cabinet. If the majority of the members thought the Government a mistake, he was quite prepared to take the consequences; but he was confident that any appeal to the country would only result in a sweeping majority for the National Government.

Sir Joseph Ward, in reply, said a great deal of criticism had been based on positions which did not exist in the Bill_ The idea that the rich were favoured at the expenses of the poor -was a misconception. The people who raised this bogey forgot that if the rich people did not subscribe, their loan could not be raised. In the last loan ie gave poor people an opportunity to subscribe, but only 125 people from the North Cape to the Bluff purchased £5 bonds. Such a result led to a fiasco and no loan could be raised on that basis. In reply to the argument that the loan should be raised at 51 pen cent, subject to taxation; he said that the investment would return a rich man £3 8s Pd per cent. and if the Joan was raised at 5 per cent, it yould return him £3 2s Cd. Was anyone insane enough to suppose that such a return as that would induce anyone to invest in a loan like that To prove that the small in vestor was getting •encouragement to invest, he quoted a circular issued in connection with the last loan, to show that holders of certificates received five per cent. Regarding the term of the loan, the experience of the last loan showed that

the majority of the investors favoured 25 years, but all classes were being catered for, hence different periods were arranged for in the Bill. Comparison between the rates of interest paid in New Zealand and Britain was out of the question, because the conditions were not normal. It was that the loan must be raised in the the mature decision of the Government Dominion, and though they had been told which people were going to rush, the loan, his opinion was that it would not be raised without a campaign and he asked everyone to assist such a campaign to the best of his abilities. He believed that if the necessity arose the people of the country would be ready to give up all they possessed to save the Empire, but the notion of the conscription of wealth, suggested in the debate, was nothing short of robbery wdrile the method proposed in the Budget was legitimate. He was not going to turn off the acknowledged paths to raise the revenue necessary to maintain th e soldiers in the field at this juncture. The duty of the Government and of the’people was to get the money to enable us to win the war, and we must do it in such a way as would not contravene the principles of political honesty. Disaster to this loan would mean disaster to the Dominion. The Bill was read a second time. The House rose at 10.12.