Government Accused Of Procrastination

Press, Volume C, Issue 29557, 5 July 1961, Page 17

Government Accused Of Procrastination

[From Our Pariiamantary Reporter)

WELLINGTON, July 4. “The charge that the National Government, by its inaction and procrastination in the first six months of its office, had allowed dangerous economic tendencies to develop. was made in the House of Representatives this afternoon by Mr M. A Connelly (Opposition, Rtocarton) during the Address-in-Reply debate. Mr Connelly also said that there were many indications that the only way in which the Government could carry out its policy was by devaluation. He quoted “informed circles" as predicting that “New Zealand is marked down for exchange devaluation either in the Budget, or if and when New Zealand join® the International Monetary Fund.” The impression had been created in the minds of the people that a major crisis was looming, for which Labour could be blamed, said Mr Connelly. The alleged

crisis oould then be used for failure to implement ejection promises.

"The cry of the National Government is 'no panic—no crash’ tactics,” said Mr Connelly. "Actually there is not need for these, because in 1958 the Labour Government took the unpopular measures necessary to restore confidence and stability, to secure a more adequate exchange management procedure and to expand production and ward off unemployment. "Crash tactics could become neceroary only if, m face of threats to sectors of the economy, reasonable remedial or safeguarding measures are Ignored or unnecessarily delayed, or if measures disruptive to the well-being of the economy are indulged in." Mr Connelly said that It was still not too late for the Government to reconaider its economic policy. The momentum generated by Labour policies was not yet spent Attention should be focused on next year rather than this year. Predicting exchange devaluation, Mr Connelly said that this would allow the Government to relax controls regardless of the consequences to the economy, and eventually to reduce death duties and taxation at the highest levels. The consequences of such a move, which he described as a classical one on conservative thinking, would be to reduce demand for imports, raise farming incomes, and reduce the wages of the small wage-eerner. It would fit in exactly with what the Government said it intended to do.