TAXATION PLANS DEFENDED

Ashburton Guardian, Volume 66, Issue 280, 7 September 1946, Page 4

TAXATION PLANS DEFENDED

MR NASH IN REPLY TO DEBATE SOCIAL SERVICES AND OTHER COMMITMENTS (P.A.) WELLINGTON, Sept. 6. The Government had no desire to drag money out of the people, said the Minister of Finance (the Rt. Hon. W. Nash) in his reply to the Budget rebate in the House of Representatives to-day. He emphasised that if after all commitments, especially social services, had been met taxation could be ■reduced then the Government would not hesitate to remit further taxes.

Mi' Nash, commencing his reply, said that the member for Temuka, Mr ,T. Acland, had declared that the hospitals were going to be nationalised. “I have heard that advocated by members of the Opposition for some time.” he said. “They have recommended that the whole cost of the hospitals should be borne by the State, but the policy of this. Government is very clear. We think that local interest must be maintained, and that there should be some financial responsibility associated with that local interest.”

Mr Nash said that he was satisfied that the hospital system of the Dominion, were it nationalised, would be conducted well, but there ivere advantages ill giving local people a share in hospital administration, and the Government proposed to continue that system. Mr Nash said that Mr F. W. Doidge during the debate had declared that it was- easy to provide £40,000,000 • for social security “under inflation.” Did Mr Doidge suggest that it was otherwise impossible? The fact was that Mr Doidge did not believe in social security, but believed in maintaining the incomes of those on high levels. Mr Doidge: I believe in paying pensions in honest money. Mr Nash said that the social security principles which had been applied in New Zealand required a certain share of the national income, and that share would never be reduced as long as the present Government retained the Treasury benches. The Opposition had affirmed, saio Mr Nash, that it would not follow the same course as was followed during the 1931-35 slump. Mr W. J. Broadfoot (Opposition, Waitomo): No country would. Mr Nash: -It is easy to be wise after the event.

Living Standards The Minister said that it was the changed policy of the Government that set the country on to a higher level, and no Opposition member could stand up for five minutes and not agree that the living standards were better and had continued to improve. The point of the whole matter was that the Opposition believed in supply and demand and in lea ™ig private enterprise in charge. lhe Labour Government would see that the mass of the people received the commodities they required, and if by a. policy of income-tax reductions money was put into the pockets of the people that would stimulate the demand for ordinary things and increase the living standards. Answering a statement by an Oppo sition member that no hospitals weie free Mr Nash said that all hospitals were free and all medicines were free to those who needed them. The people who really required treatment were in the hospitals to-day. Mr Nash said that the Leader ot the Opposition apparently objected to the relief the Budget gave to the working man and to companies, would object to taking off the gpld tax to keep the gold companies alive tor a longer period, and who would object to the reduction of the war surcharge on incomes? The Leader of the Opposition had suggested that it was wrong because it would increase company profits. Was it wrong to remove war taxation? , J . , Denying Mr Holland s statement that he (Mr Nash) was out of touch with the country as he had been away so much, Mr Nash said he was away only 103 days. He could imagine what the Opposition!! would have said if throughout all the conferences of the type lie had attended- New Zealand tmd had no representation. Departmental Expenditure

Mr Nash said that Mr Holland was vicious and misleading when he claimed that departmental expenditure was revealed in the Budget to have increased by £43,000 000. The _ Budget had shown that there was an increase in the annual appropriations of £43,000,000, but the Budget also stated that £19,750,000 was for war expenditure. There was also a sum of £4,143,000 for credits in aid, and it was unfair to the country to urge that these credits in aid should be transferred from one procedure to another and then to criticise the Government and say that it was increasing expenditure by that amount. There was an item of £11,000,000 more in the Social Security Fund, and Mr Holland had claimed that that would be an increase in departmental expenditure. There was nothing more misleading. The Minister said that great interest had been shown in the Budget, and more than 1000 copies of it had been sold. It could be seen on Page 26, he said, that the increase in departmental expenditure was £5,000,000. Mr Holland had said that it was not the policy of the National Party to cut wages or social security. If that was the case, then the National Party would have to maintain the present position which they had described as inflationary. Mr Holland had expressed concern, said Mr Nash, because of the value of import licences issued—£loo,ooo,ooo — the amount of New Zealand’s sterling balances, but Mr Holland forgot that New Zealand was replenishing those balances by export as rapidly as she depleted them by imports. As imports became more freely available sterling balances would decline, but that would be quite satisfactory.

It had been alleged from the Opposition benches that one individual could import £IOO,OOO worth of goods if lie could obtain the licence. Mr Nash said that any individual who could import essential goods would be given a licence, but no person would get a licence to import £1,000,000 worth of luxury goods.