REPLY TO CRITICS

Press, Volume LXIV, Issue 19311, 16 May 1928, Page 9

REPLY TO CRITICS

DEFENCE OF GOVERNMENT. ADDRESS BY MINISTER FOR FINANCE. [THE PBESS Special Sorrice.] AUCKLAND, May IS. The Hon. Mr Downie Stewart, Minister for Finance, addressed a representative gathering of Auckland bnsinesi men to-day. Dealing first with criticisms occasionally levelled at tho Government, Mr Downie Stewart said this was welcomed in a general senso as from Chambers of Commerce and such bodies, but objected to when they came from tho leisured class who were capable of assisting in the public affairs of tho country and refused to take their part, content apparently to take an occasional trip to Sydney races and to criticise those who did the country's work. Reverting to tho strong criticism which had come from Auckland to his refusal last year to reduce tho incomo tax, he said he was still unrepentant ami argued that anyone of his henrors, had they a full knowledge of all tho facts, would have acted as he had done. Tho position of taxation generally hßd in recent years become very anomalous. Incomo tax had become so restricted in its incidenco that it was impossible to rectify these anomalies all at onco and at the samo time obtain tho revenue needed. To have rescinded company taxation, and made up tho difference on individuate was a task that no Government making the change could have survived. Theoretically direct taxation was correct, but actually publie opinion would not accept this method. Sank Bate. Referring to recent remarks on tho bank rate, tho Minister said ho had been criticised for having said that political influence had been used with the Bank of New Zealand. Ho must have clumsily expressed himsolf if that opinion had been correctly reported. What he had said was that ho was fully entitled to make representations to tha Government representatives on the Bank of New Zealand, but having made representations the Government was not entitled to go further. Banking jouruals, he said, had accepted tho view that he had acted properly in limiting his action as he had done. ■ The samo position had arisen again lately and he had drawn tho attention of the Associated Banks to tho improved position in ro« gard to their returns, suggesting that the matter might again be reviewed. The Banks' reply was that if the present trend continued they would be able to reduce the rato, but no data had been given and ho had not deemed it fit to seek to carry tho matter further. Trade with Australia. Touching on tho mattor of trade with Australia, the Minister said a difficulty which confronted him was that the two countries had different policies in regard to protection. Australians did not seem to set their standard at tho best organised and most efficient industry as tha one which should determine the amount of protection that should be granted by tariff, but their standard seemed to'bb set to suit the average firm, or even, lower than that. The New Zealand policy, on the other hand, was to encourage the resourcefulness of our manufacturers by insisting that our protecr tive tariff should bo based on the needs of the beßt organised industry. Ho quoted an unnamed manufacturer who had been refused protection a year ago. This manufacturer, who had at that time said he feared having to close down, had reduced the number of his lines, put his men on piecework, given them certain guarantees, and his turnover had since more than doubled. (Applause.) In this connexion, he was very hopeful that the Industrial Conference now sitting in Wellington would devise some means that would bring about an improvement in our secondary industries without further appeals or tariff protection. Politics. Dealing with political conditions generally, it seemed to him that the publie was dissatisfied in other than our own. He had come to the conclusion that the democratic machine could scarcely adapt itself with sufficient promptitude to meet the changing views of the people as a whole. In parts of Europe this discontent had shown itself in a disposition to leave democracy, and seek, for dictatorships. If democracy was going to be preserved ia this country it was necessary that many of those qualified to lead the people, and help in the administration of publie affairs, who did not at present take any part in the government of the country, should come forward and do their part. This waß particularly necessary in view of the depletion made by the Great War. No doubt 'many of his hearers had the idea that they could | do his work better than he could, and j possibly they wore correct. Someone had to do it.