WAR LOAN TERMS.

Auckland Star, Volume LXXI, Issue 237, 5 October 1940, Page 5

WAR LOAN TERMS.

"UNJUST AND UNWISE" MR. HAMILTON'S COMMENT. \ WELLINGTON, this day. "The War Cabinet has justified its existence and the purpose for which it was set up," said the leader of the Opposition, Mr. Hamilton, when he spoke during the final stage of the war finance debate in the House of Representatives yesterday. When it ceased to justify the purpose for which it was established, then the War Cabinet would cease to exist, he continued. "But that lias not happened," he added. "It is working efficiently. There are points of difference that want clearing up, and these are receiving attention." Answering suggestions whicfc had come from his own side that the War Cabinet, of which he was a member, should have been consulted regarding the terms of the war loan, Mr. Hamilton contended that such a criticism could not be sustained, because if one went back to the origin of this compulsory loan, it would be found fully explained in the Budget, where it was stated that the loan would be interest-free for three years or until 12 months after the termination of the war. "I am not trying to defend the Government," said Mr. Hamilton, "but that is where the war loan had its origin, and that was before the War Cabinet was set up. If it had gone before that body, it could not have altered the Government's declared policy." Reason for Criticism. Where he found reason for criticism was in the fact that the war loan had not come before Parliament in the form of a bill. Too much use should not be made of Orders-in-Council, he said, and if the Minister of Finance had brought in a bill to authorise the compulsory loan, instead of asking the House to discuss a regulation, he could have heard 1 opinions on the terms of which he might have been inclined to take notice. The loan was mentioned in the Budget, but not the terms. The Minister of Finance, Mr. Nash: You had the opportunity of discussing it on the Budget. "People must not expect the War Cabinet to usurp the functions of Parliament," added Mr. Hamilton. "We must not take away the right of Parliament to discuss the terms of such a loan. They are the Government's proposals, not the War Cabinet's." The Minister of Internal Affairs, Mr. Parry: I wonder what they would have been? Mr. Hamilton replied that it was the Government's responsibility, and Parliament should have had a prior opportunity of discussing them. He considered there was a good deal of politics in the Prime Minister's speech during the debate when he contended that the Opposition was protesting against conscription of wealth. Nobody on the Opposition side complained of a compulsory loan, for it was nothing new jn Xew Zealand. Wealth had to make its contribution like other interests. The Prime Minister, in becoming indignant over the criticism, was, in his opinion, _ trying to please the back-bench type of thought in his own team, endeavouring to justify the fact that they were trying to get some interest-free money. "This is not conscription of wealth," said Mr. Hamilton, "and if the Government comes along with a capital levy, we are prepared to discuss it. Our criticism is that this loan is unjust and . unwise, but we are not opposing compulsion. "Tax on Effort." "It is unjust because it does not catch wealth, and it is unwise because ! it attacks the economic life blood of ; industry. It is a tax on effort, not on wealth. This is too common a custom . with tlic Government, which is pretty i hard on the man who is thrifty and ; industrious, but the spendthrift who . spends on unnecessary items does not i get the same penalty put upon him." i Mr. Hamilton estimated that companies would have to subscribe £5.500.000 of the £8,000,000. and that individuals would subscril>e £2,500,000. i He condemned the regulation which required the Minister to be furnished - with the names and particulars of tho?% I who did not subscribe to the extent they - were expected.— (Parliamentary Re- { > porter.)