WELLINGTON TOPICS.

Taranaki Daily News, 31 January 1922, Page 8

WELLINGTON TOPICS.

THE SALARIES CUT. CONTINUED PROTESTS. ’ (Special Correspondent.) Wellington, Jan. 25. The, storm of protests against the proposals of the Public Expenditure Adjustment Bill continues, but (there is a growing disposition on the part of the mere responsible critics to moderate the tone of their objections. - On this account their representations are likely to be all the more effective. In the House last night, indeed, Mr. Massey conceded several of the points urged by the Opposition and preserved throughout the preliminary committee discussion a spirit of “'sweet reasonableness.” He promised concessions to married men with large families and to junior employees with small salaries, and undertook the second “cut” should be postponed until July and the third till the first quarter of next year. The first cut had to be made during the current quarter simply because the Government needed the money to “make ends meet.” The amount the Minister now expects to save by the reduction of salaries is £1,885,840, an amended estimate which implies he expects his promised concessions to cost him a considerable sum.

LABOR'S ATTITUDE

Though the official Labor Party has modified its demand for fhe exemption of salaries of £5OO a year to salaries of £450 a year, it continues to insist that the money required should, be obtained by increased land and income taxes. Mr. Holland seems to think there is no burden the large landowner and the big business men are incapable of bearing and that Mr. Massey’s refusal to shift the whole load on* to their shoulders is another indication of his class prejudice. He twitted Mr. Wilford with inconsistency in having first condemned the Bill and then voted for its second reading, and when the Liberal leader explained he had voted for the second reading in order to show his approval of the reduction' of members’ salaries, he described conduct of that kind as mere camouflage, destined to deceive the unwary. If Mr. Holland really is the friend of the State employees he* is not going to work very wisely in maligning their other friends. CASUAL CRITICISM. Severe criticism of the Bill came, not only from the official Labor Party. Other members denounced in unmeasured terms its principles and application. Dr. Thacker, for instance, declared that the Prime, Minister had “torn up the scrap of paper” and had dishonored his agreements with the public servants. He did not believe that the Minister during the past, two years had made one fair and open statement of the condition of the country’s finances. The Reform Party had squandered the public moneys and stuffe'd the Public Service with incompetent employees. The member for Christchurch East held the House by his very intensity; but the Hon. J. A. Hanan by his moderation was much more impressive. He read a list of big salaries raised by £3OO or £4OO since the beginning of the war, and wanted to know how the increases were to be justified. And no justification was forthcoming.

‘ABOUT THE CITY. The business people of Wellington, though not directly affected by the cut in the salaries of State employees, are taking a very keen interest in what is happening in Parliament just now. The galleries of the House have been more fully occupied during the discussions of the “Retrenchment” Bill than they were at any time during the course of the war, when even bigger issues were at stake. The general opinion among the local public, so far as it can be gathered, is that Mr. has faced the big task before him with admirable courage and candor, but with less intimate knowledge of the situation than he should have possessed. The plain truth of t\h e matter is that he does not grasp the meaning and significance of figures as quickly as Sir Harry Atkinson and Mr. John Ballance did, and has not the same

capable officiial assistance as Mr. Seddon and Sir Joseph Ward always commanded. Public financiers are born, not made, and their number is always limited. THE RETRENCHMENT BILL. JTS OPERATION. Wellington, Jan. 27. Though there has been much talk during the week inside and outside of. the House concerning the Public Revenue Adjustment Bill, popularly known as the Retrenchment Bill, there still seems to be in many quarters a good deal of misunderstanding 'as to the essential principles of the measure. Even Mr. Massey, who has been required to carry a vast amount of detailed information in his head, has occasionally lapsed into somewhat loose expressions in regard to increments, advances, increases, bonuses and so forth that have tended to add to the general confusion. In the House, for instance, he has repeatedly referred to the addition of £45 to salaries in 1918 and the cost of living bonus of £5O in 1920 as if they affected all civil servants that participated in the payments in precisely the same way and to the same amount. As a matter of fact, however, the £45 advance was graduated from £<ls to £7O, while the £5O bonus began at £2O for the lower paid employees and jumped to the F ull £5O on a salary of £215 a year being reached. WAR ADVANCES. Then there is much misapprehension as to what has happened to the salaries of civil servants since 1914. Previous to the war juniors entered the service at a salary of £5O a year and progressed by increments of £l5 a year till at the end of thirteen years, showing no special ability and follov.;ing the usual course, they received £220 a year. In 1919 juniors began at £65 a year and were able to reach a salary of £270 at the. end of their twelfth year. In 1920 the junior’s beginning salary was raised by the cost of living bonus to £B5 and the graduations carried the maximum salary of tjie class to £320, including the full cost of living bonus. The minimum salary for married men in the Service is now £234 15s, equal to 15s a day or £4 10s per six day week, and it is presumed this minimum will be maintained under the readjustment provided by the Retrenchment Bill. The recognition, of this principle was one of the few concessions Mr. Massey made during, the passage of the Bill through the House. THE HIGHER SALARIES. Speaking generally, the salaries paid in the b' 1 'Service are not excessive. ’ There r's single men and women find s,’.iu drawing saUrUs of

£3OO or under and only fifty or sixty drawing salaries of over £lOOO. But there have been constant demands in the House for larger deductions froin the big salaries in keeping With the principle of “equality of sacrifice. Mr. Mvssey has resisted these on the grounds that the recipients of the higher salaries dil not receive the cost of living bonus and are liable to the exactions of the largely increased income tax. Here he is on fairly sound ground, but he should have mentioned that between 1914 and 1921 some of these gentlemen who did not participate in the bonus were consoled by ‘ very substantial additions to their salaries. Between 1914 and 1921 the salary of the Secretary of the Treasury was advanced from £976 to. £l2.w -of the Commissioner of Taxes from £650 to £1250, of the Assistant Secretary of the Post Office from £750 to £lOOO, and of the Manager of the State Fire Office from £5OO to £lOOO.

REDUCTION AND TAXATION. In considering this aspect of the retrenchment scheme, however, it is only fair to remember that the higher Daid civil servants contribute very substantially to the revenue of the country by way of direct taxation. The State employee left with £3OO a year will escape income tax altogether. The recipient of £350 a year will pay £2 10s, of €450 £7 10s; of £550, £l2 10s; of £6so*, £2O; of £744, £23; of £B2B. £37 ; of £9lO, £65; of £990. £74; of £lOBO, £B4. This will mean, taking reduction of salary and taxation into account, that the £3OO salary will contribute 14.3 per cent, to the revenue, the £4OO 13.0'; the £5OO, 11.5; the £6OO, 10.4; the £7OO, 10.0; the £B<M), 9.8- the £9OO, 12.1; fhe £lOOO, 15.5; the £llOO. 16.7;-and the £l2OO, 17.0. D contributions by way of taxation can ho included in the same category a* reductions in income, then there has been some approach to equality of sacrifice. But on this point, of course, there will be wide differences of opinion. Probably many of the lower paid civil servants would regard the payment ot income tax ftt the present rate a very desirable experience.