ECONOMIC POLICY IN N.Z.

Press, Volume XCIII, Issue 27962, 8 May 1956, Page 7

ECONOMIC POLICY IN N.Z.

Mr Moohan Attacks Government ADDRESS TO LABOUR PARTY (New Zealand Press Association) WELLINGTON, May 7. The Government had been trying to foist on a modern economy worn-out theories completely unsuited to the present-day economy, said the president of the New Zealand Labour Party (Mr M. Moohan) in his address today to the annual conference of the party. Faced with a heavy conversion loan and with the economy under pressure from credit restraints, the Minister of Finance had been forced to announce a substantial increase in interest rates, Mr Moohan said. “This action must serve to increase costs and prices to the detriment of our people, and one of the worst features was the increase in interest rates announced recently by the State Advances Corporation for home building loans,” said Mr Moohan. It was important that the people should be housed at the lowest possible interest rate, he said. The Government had proved itself to be the most profligate in the history of the country, Mr Moohan said. It had had a record overseas income exceeding that of 1949 by £100.000.000 a year. It had had unprecedented receipts from the wool sales. It had already borrowed £24,000,000 over“AII this and £10.000,000 more have been squandered on a spate of imports, much of which was unnecessary for the economy of the Dominion, and our valuable overseas assets have been reduced to a dangerously low level,” he said. The Government’s only answer now was a credit squeeze with promises of a tighter credit squeeze, and the effects of that to those engaged in primary production, in the manufacturing industry, and in business and commerce would be disastrous. “Failed Miserably” The Government had failed miserably to solve the power problem, Mr Moohan said. It had failed to control prices after pledging itself to reduce prices, and it had failed abysmally to control the cost of living. It had failed to prevent price rings, monopolies, and restrictive price practices from forcing up prices to the detriment of the consumer public.

It had failed to maintain the contract price system to potato growers, with the result that heavy gluts were now succeeded by an extreme shortage and the people were being forced to pay exorbitant prices for potatoes. “Labour will offer to the people a clear-cut. definite, and progressive policy,” Mr Moohan said. “We reaffirm our belief in a low rate of interest for the housing of our people, we will have a policy of import control and allocation of overseas funds.”

A government was needed where no price rings of bankers, money-lenders, and monopolists should be allowed to usurp the power that rightly belonged to the elected government, said Mr Moohan.