WELLINGTON TOPICS.

Taranaki Daily News, 6 October 1922, Page 3

WELLINGTON TOPICS.

STATE AND MUNICIPAL TRADING. THE GOVERNMENT’S POLICY. (Special Correspondent.) Wellington, Sept. 29. 'Surprise has been expressed in some quarters at no mention of State and Municipal Trading undertakings being made in the Taxation Amendment Bill introduced in the House of Representatives on Tuesday. The Prime Minister is known to ;be favourable to bringing these undertakings the operation of the land and income taxes and it was thought he might effect his purpose by a clause in the amending Bill. But apparent! j r Mr. Massey has preferred to make use of the Finance Bill, which will be produced a little later on, and so dissociate the remissions of taxation from the additional imposts. Meanwhile he has reiterated very clearly his views on the question. He believed himself, he said, commenting upon Mr. Wil ford’s concern for the /‘State business Departments,” that such undertakings could be controlled better by private individuals than by the State, and that, in any case, they should pay their fair share of taxation. This, he added with emphasis, was the policy of the Government.

CHANGED PUBLIC OPINION. Public opinion in regard to S*-ate and Municipal trading undertakings has undergone a very remarkable change during the last few years, and .particularly during the last few months. This has been due partly to the indiscriminate advocacy of the irresponsible Labour Party, and partly to the failure of the extremists’ theories in practice, but mainly to a critical examination of the facts and the spread of information on the subject. Mr. Massey’s belief that business and trading undertakings can be better managed by private individuals than by the State or by the Municipality has .been justified over and over again in this and in other countries. There are, of course, such public services as railways and post and telegraphs, that properly .may be made State monopolies, but beyond this limit fixed private enterprise, subject, to the law of Hie land, reigns supreme in every department of trading achievement. This conclusion has been forced upon many former apostles of public ownership and has become the creed of the great majority of observant s and well-informed people. UNFAIR COMPETITION.

Probably Mr. Massey’s judgment in this matter has been even more influenced by the unfair operation of municipal trading undertakings than by the unsatisfactory results obtained from State undertakings of the same character. The exemption of municipal undertakings from taxation has given them an enormous advantage over private undertakings, and but for the inherent defects in their management, they would have been bound to oust all opposition." But the exemption is so obviously unfair, both to the competing private concerns and to the great body of taxpayers, that anyone taking an unbiassed view of the position must condemn its continuance. The exemption from taxation of any municipal undertaking in Wellington or Auckland or Christchurch or in any other centre means inevitably that some portion ot the burden that should be borne by the local community is being shifted on to the shoulders ‘of the general body of taxpayers who can obtain no possible advantage from the enterprise. In Wellington there is the spectacle oi municipal electric light, freed from all taxation, competing with proprietary gas burdened with every impost the taxing department can devise.

ATTITUDE OF PARLIAMENT. Nine or ten years ago no Government would have dared to talk, of taxing State and municipal trading undertakings. Sane Labour in those days was moving warily towards the nationalisation of quite a number, of public utilities. Three years ago sane Labour was supplanted in Parliament to a large extent by extreme Labour, and the early indiscretions of the new Party, which included wild talk about the nationalisation of everything under the sun. set people looking a little closer than they had done before into the results obtained from such State and municipal trading enterprises as already were in operation. Knowledge necessarily brought about a change of opinion, and the public without rejecting the be.ne£cexit theories on community control

lost faith in their efficiency in practice. The present Parliament, though admittedly vonly a rough and ready reflection of public opinion as it existed three years ago, is sufficiently in touch with current thought to appreciate the new position. It will give effect to whatever the Prime Minister may propose and Mr. Massey has made his own views perfectly plain. The policy of the yill prevail.