CIVIL SERVICE CUTS

Evening Post, Volume CXI, Issue 66, 19 March 1931, Page 14

CIVIL SERVICE CUTS

J3IR-1\ D. BELL'S ATTACK

SOME, ALTERNATIVES

DEBATE IN THE COUNCIL

A strong, condemnation of the proposal of the Government to cut the' salaries of Civil servants by 10 per cent, was made by the Right Hon. Sir Francis Bell when speaking in the Address-in-Reply debate in the Legislative Council yesterday afternoon. He .said a tax on a special class of the community and, to a large/extent, a poor class, was contrary to the principles of equitable taxation, and could not be justified. As alternatives to the cuts he suggested that use should be made of the accumulated surpluses and the profits of the Post Office and that increased taxes should be placed on sugar and tea.

Resuming his speech after "Tlio Post", •went to press, Sir Francis said that the greater part of the Public servants were removed from political control in 1912. Before that the salaries of Public servants were reviewed every year by Parliament, and criticised in detail by 'members. With the removal of the Service from political control, a Commissioner was appointed, and his first duty was to classify the . Service, fix the salaries of the various grades, and the accretions towards, the maximum. AH Parliament had to do was to vote the amount that was necessary to pay the salaries. Sir Francis submitted that thero was no difference in principle between the House approving of a sum of money with •■ which •to pay tho Civil Service and approving of .a.sum sufficient to pay the Public Debt That was a very important point for the House and the' country to consider. The Public servants were a special class of the community, .and ho < submitted that they were a very defenceless class. Tho Civil servanY did not dare to refuse a lower rate of pay, owing to the tremendous loss which such an action would involve., Ho would bo forced to retire, and as a result he would lose all his superannuation rights. 'Parliament could' not compel private,. employers to reduce the salaries and wages they paid to their employees, but Parliament could : compel the Government, with one stroke of the pen, to deprive its servants of 10, 20, or even 50 per' cent, of their salaries.

A STARTLING PROPOSAL. The Civil servants are being asked to bear one-third of the deficit which , the Prime Minister anticipates, said Sir Francis.' Surely it is a startling' proposition. How can it be fair?

"It is a prineiplo of taxation _ that although everyone should' contribute to tho revenue of the country in some measure, the greater part should fall on tho shoulders of the rich and not tho poor. Another principle is that -ishere a tax is mado on a special class for a special purpose, it is an'unheard of thing for a special poor class to bo selected to boar a largo part of the burden. It is out of the question, for the Government to find an authority for such an exercise of class taxation as

is proposed." Sir Francis quoted figures to show that ■ there were 53 Civil servants receiving over £1000, 308 receiving from .€750 to £1000, 1291 receiving from £501 to £750, 4(26 receiving from £350 to £500, and 46,281 receiving less than £300, of whom 22,350 were receiving less than £200." The Civil servants of the Dominion wero being asked to contribute £1,500,000 to the State, and of that amount those under £300 were going to contribute £1,250,000. INTOLERABLE: UNBEARABLE. "It is all very well to talk about the equality of sacrifice," said Sir Francis, "but what justification can there be for such intolerable, such unbearable taxation as this? Not one other person in the Dominion on such a salary is being asked to contribute one shilling. 1 don't know whether members - of this Chamber realise it, but a taxation of 2s in the & does not operate until a man's income is in excess of £2000. The income tax on £1500 is Is 7d Here is a direct levy of 10 per it is no use" calling it anything c l sc _on one section of the community, a levy which no other section is called upon to.pay. It is a very serious matter to tako £20 away from a man who . is supposed to live like a Civil servant: "We don't realise that, Sir, unless we take pause to think. Under the pseudonym of public economy you are taking a special clasa of the community and taxing'if at a rate which it can-; not stand. Is there an' honourable member of this Council who would deal with his servant-in this way? It is turning parsimony into a virtue when it is really a vice.

NO PRECEDENT. "There is no precedent and no economical justification for taxing to this hugo extent a specially limited class and a specially poor class. This appeal to patriotism- is very moving,, but it is very easy.' The same appeal lost to us the American colonies. The same appeal led to tho Crimean War, and thesamo appeal cstablished-the Turk in Europe. There has been talk of faith in the future and hope for the future. Faith, hope, charity—and the greatest of these is charity, which may be fittingly interpreted a3 sympathy. "We have been told that -there is ~ no alternative. But Lang has said that he has no alternative but to repudiate the Public Debt, and Scullin that there ig no alternative but to diminish interest. This talk of there being no alternative leads to nothing. There is an alternative." Sir Francis said. that year by year accumulated surpluses had been built up, and that at present there was a sum of £2,000,000 lying at tho Treasury. It was not merely a book entry but solid cash.1 It was true to say that this sum was ■ for cases- of emergency, but the present position was an emergency. "I hopo there is no member of the Council who' would rather tax tho poor people than' use tho accumulated surpluses to meet the present position," he said. He ventured to suggest that there was'lying to the credit of the Post Office at the present time something like £1,250,000, which had been built up from the profits of the Post Office. That, too, was more than a book entry; it was in cash. It was ridiculous to think that while tho Consolidated Fund was drawn upon to.meet • the deficit in the railways, the profits of the Post Office were not paid into the Consolidated Fund. Surely any- , thing would be better than tho proposed 10 per cent. cut. A TAX ON SUGAR. "I know that the breakfast fable is * very sacred thing," said Sir Francis, "but if one penny in the pound wore placed on the duty on sugar it would produce £650,000 a year. Twopence in the pound would produce £1,250,000. That amount would not add more than Gd' a week to the expenditure of the

average household. An additional tax on tea would also produco a considerable amount. MR. FORBES NOT A PROPHET. Sir Francis said ho . did not believe ' things were going,to bo as bad as had'1 been predicted. Ho was prepared to accept any statement of fact from the Prime Minister, but ho would "like to know when Mr. Forbes had qualified. as a prophet. He knew that thcro was' a ■ temptation on every Treasurer to estimate that expenditure would be in; excess of revenue. The Prime Minister had predicted that one cause of1 tho | prospective Budgetary deficit would be, diminished Customs duties, but it was his belief that tho next year would! show- an increase in Customs duties, in spite of the exchange rates, as im'HMters were working at present on ;'::na!l stocks, ami it would bo necessary for them to replenish those stocks in Ihii nuar future. If I stand alone in the Council, said Sir Francis, in conclusion, and if it is my last day alive, I will be glad that I have stood alone against this wicked and unjust taxation. OTHER SPEECHES. The Hon. Sir Kdwin Mitchclson said he could not agree with tho last speaker, although he agreed that people with less than £300 should not be subjected to the cuts. The position into which the country had drifted was due to excessive borrowing and reckless spending, and now they had to' pay the penalty. He believed that private employers would follow the example which had been set by tho Government. Surely; in view of the financial position of the country, people would sec that it was necessary to take drastic steps to effect an improvement, and it was "up to" every member of Parliament to play his part iv again placing the Dominion on tho high-road to . prosperity. Sir Edwin referred to what he-called wasteful expenditure on .railway lines which could not, pay their way, and asked how the Railway Department could be expected to show a profit under such circumstances. . Party feelings should be sunk at present, said Sir Edwin, as it would ' be disastrous to defeat the Government on its proposals and force an election. In the event of an election; Labour would come back stronger than the other parties. . Tn his opinion, a clause should be inserted in the Finance Bill at present before the House doing away with prefcrfiiice to unionists. Tho Hon. D. Buddo referred to the heavy' cost of maintaining the Civil Service, and said it would be.an extraordinary thing if it were not touched. It was" tho duty of every man 'and woman to share in the general sacrilico that would be necessary if the country was to recover. At the same time he thought they should not give way to a, depression of spirits, even if. they did have a depression of trade to contend with. He. thought that local bodies might do a lot to assist the Government 'by practising economies, especially in respect of borrowing. No loans should be authorised unless they were approved by the.ratepayers. Although he did not advocate a moratorium, which was really a boomerang, he thought there should be some\ arrangement whereby the interests of mortgagees and mortgagors could be safeguarded. He held tho opinion that the day of gold securities had gone. Mr. Buddo devoted some attention to the question of the wheat duties, and referred in detail to costs of production as against costs of distribution. ■ He did not -favour the abolition, of the duties. Tho debate, was adjoiirnc-d on the motion of the Hon. Mark Fagan.