The Press THURSDAY, JULY 7, 1960. A Vital Principle At Stake

Press, Volume XCIX, Issue 29250, 7 July 1960, Page 12

The Press THURSDAY, JULY 7, 1960. A Vital Principle At Stake

The Government’s argument with the Auditor-General (Mr A. D. Burns) is not very edifying. It will, however, serve a good purpose if it draws public attention to the cause—the deliberate flouting of Parliament by thp Government in altering tax rates without reference to the House of Representatives. This should not be lost sight of in any confusion about precedents, technical authorities, or any trifling error in the AuditorGeneral’s annual report. If Governments, of any party, persist in altering tax rates, either up or down, without the authority of the people’s representatives then we shall have no Parliamentary democracy at all. Indeed, the very existence of bad precedents (set by both parties) makes it all the more necessary for Parliament to say now that it will have no more of this dangerous practice, so roundly and prophetically condemned by the pioneer Labour leader, Mr H. E. Holland. If Parliament will not say that, then the people must, or jeopardise all their liberties. The public purse should be controlled by the public, or our democracy has no foundation. The chief precedents for a Government’s alteration of taxation rates withom Parliamentary authority are worth studying. The first was a reduction of wageg tax announced by the Fraser Government in 1946 and put into effect before the new Parliament could meet. Parliament adjourned on October 12, and Mr Fraser announced the change just three days later. It is less important that he did so when opening an election campaign than that he must have known -vhat he intended when the last Finance Bill was before Parliament. The second major orecedent was a reduction in petrol tax by the Holland Government in 1951. This was also announced by a Prime Minister at the opening of an election cam-

paign—but with this difference: because of a Labour challenge the session had been interrupted for a snap election. The Prime Minister spoke in midAugust when, as he said, he would in the ordinary course of events have been making his Budget speech. It may be thought that the second case was less serious than the first. We can see no difference in principle. They were equally bad. The third and latest example was a general reduction of taxation by the present Government 11 days after Parliament had adjourned. We cannot imagine why Parliamentary authority was not obtained. What does concern us is the Government’s assumption that it really did not matter. It does matter.

It may be argued that when a Government reduces taxation Parliamentary approval is only a formality. That is a dangerous and specious argument for at least three cogent reasons. First, a reduction of levies in some circumstances could so alter the incidence of taxation as to work great injustice. Second, a tax cut could .so unbalance the national accounts as to endanger national stability and prevent the honouring of contracts. Third, if Governments catch the pernicious habit of altering taxes without Parliamentary authority they will, sooner or later, find some reason that seems good to them for increasing taxes. And the public will have grown so hardened to dictatorial Cabinets that they will hardly notice. Let us look at another and a better precedent. When the entry of Japan into the war in 1941 created a national emergency graver than we had ever known before, busy Ministers found tin e to meet Parliament in special session to seek approval of c new fiscal policy Are our Ministers now so much busier that they must let Parliament await their convenience?