PARLIAMENT.

Press, Volume LXV, Issue 19691, 7 August 1929, Page 11

PARLIAMENT.

BUDGET DEBATE OPENS. MR DOWN IB STEWART DEFENDS REFORM FINANCE. (p&sss ASSOCIATION T*L*®B4*.) WELLINGTON, August 6. When the House of Representatives met this afternoon the Leader of the Opposition, Mr Coates, gave notice of his intention to move an amendment to the Customs Amendment Bill when it was introduced. Notice was given of intention to introduce the following Bills:—Wanganui Harbour District Empowering Amendment Bill (the Hon. Mr Veitch), Timaru Harbour Board Loan Bill, 1929 (Mr Carr), New Zealand Institute of Architects Amendment Bill, 1929 (Mr Wright), Petone and Lower Hutt Gas Lighting Amendment Bill (the Hon. Mr Wilford).

Replying to Mr Nash (Palmerston), Sir Joseph Ward stated that he would bs glad to look into the suggestion to set aside an afternoon during the session for Members of Parliament to visit Massey College. The following Select Committee to investigate matters relating to wheat industry was appointed: —The Hon. Mr Forbes, Messrs D. Jones, J. Bitchener, F. Waite, C. Carr, J. McCombs, J. A. Macpherson, C. A. Wilkinson, H. R. Jenkins, and the Hon. Mr Cobbe. The Otago Harbour Board Empowering Bill (Mr Munro) was introduced and read a first time. The House resumed consideration in committee of the proposed new Standing Orders. The proposal to prohibit the circulation of newspapers in the House was rejected. A number of formal amendments were adopted, and the new Standing Orders were then agreed to. They come into force as from tomorrow. Sir Joseph Ward tendered the thanks of the House to Sir Charles Statham for the work he had put into the revision of the Standing Orders. Sir Charles Statham, replying, stated that he hoped the new Orders would stand the test. Messrs Fraser, Nash, and Smith also expressed appreciation of the efforts of Sir Charles Stathaii.. , The Hon. Mr Wilford paid a tribute to the manner in which the work had been carried out by Sir Charles Statham. Financial Debate. The Financial Debate was opened by the Hon. Mr Downie Stewart, Minister for Finance in the late Government. (A part of Mr Downie Stewart's speech is noted elsewhere). Referring to the public debt, Mr Downie Stewart said that the policy of the Reform Administration had been to taper off borrowing. The increase in the public debt had been eleven millions in 1926, seven millions in 1927, and five and a half millions in 1928. and during the short session he had expressed the hope that the increase for next year would be lower. The first effect of the change of Government was that the policy of debt contraction was reversed, and already the public debt Had increased seven and a half millions. That was mild compared with what the future held, if the Government's full loan programme developed itself. In his opinion it was far too high. He also considered that it would be wiser to delay heavy expenditure on railways until the problem of making them selfsupporting had been solved. Unfulfilled Promises. The system of taxation outlined in the Budget was most inequitable. Ji might catch some who, as the Prime Minister had said, had not been paying their share, but it seemed to him that men who were in a heavy way indebted would be subject to a heavy capital tax, and would not be able to meet that tax. In conclusion, Mr Downie Stewart said the Budget disclosed that the Government had failed to reduce taxation, to reduce the cost of money, and to fulfil many other promises. In particular it had planned nothing to help the secondary industries, and he thought the manufacturers would be very disappointed in this respecj>. j Mr Forbes Replies. The Bon. Mr Forbes (Minister for Lands) congratulated Sir Joseph Ward on the Budget, and said the fact that Sir Joseph Ward was in charge of the finances of the country had producer a feeling of confidence. He differed from Mr Downie Stewart's view that the normal increase in revenue would have met the deficit, inhere were increasing charges to be faced, ana it was necessarv to find more money, his opinion it was very sound unance to provide for a possible future deficit by securing a large surplus. He not subscribe to the view that a small deficit was a satisfactory state for th« finances of the country. It had b*en necessary to provide large BUD " {j* tl * State Advances Department which he contended, had not been fed with the necessary, funds by the ministration. There haa oleic neglect of one of the most tmporlant functions that the State was called on to perform. Railway Building. Referring to railways, Mr Forbes said Sir Joseph Ward had taken the country into his confidence before the election. He had placed all his eards on the table, and had been returned with the endorsement of the policy he had been advocating. So far as South Island railway extension was concerned, Mr Forbes said he was sure there were many people who would prefer to travel by it than by sea. T,*na Settlement. The Minister added he had always been a believer in the graduated land tax. Where men were keeping back settlement and the progress or the country, they should be prepared to pay for that privilege. That principle had been approved not only by the present but also by the former Government. He felt that large fanners would realise that they had had a good time for many years, and now that there was a deficit they would consider it only fair that they should help to make it up. He had not yet, at any rate, heard any serious objection to the proposals. If a man found that his taxation was too heavy, he could cut off a farm or two and bring himself down to a reduced scale, and at the same time bring about land settlement, which, after all, was the chief objective of the Government. If it failed in that respect, it might expect the same fate as its predecessors. It had been stated that heavier taxation on land would apply to small farmers. That was not so. The number of fanners who would be affected totalled only 1752. He had no doubt that the proposals would be accepted by the farmers and by the eountry as a whole, as a very necessary thing. On the other hand he expected the criticism that the taxation of big landholders had not been increased enough. Bat the Government had recognised that these men might have made their financial arrangements in advance, and a sudden change of a more substantial nature might have caught them unawares, and created an awkward situation for them. The Minister, in conclusion, said he knew of many eases in whieh the taxation of landholders had been insufficient. One p""» had told him that mad*

£SOOO per year, and paid only £IOO land tax, which ha did »ot consider fair. "The Government has now made him a eontented man," added Mr Forbes, who remarked that the Prin»e Minister had received telegrams frem one end of the country to the other congratulating him on hi# Budget. The debate was adjourned <m the motion of Sir George Hunter, aad ffce Botim mm at 9M