Candidate Replies To Labour Criticism

Press, Volume CVI, Issue 31341, 11 April 1967, Page 18

Candidate Replies To Labour Criticism

The Labour Party was now claiming that the Government wanted unemployment, said the National Party candidate for Fendalton (Mr S. F .Holland) last evening in the Bryndwr Hall. He spoke to an orderly audience of 120. “Why the National Party should want unemployment I don’t know,” said Mr Holland.

The Labour Party was also claiming that the Government was thinking up ways of dismantling the social security scheme—that free medicine was in jeopardy. One wondered how serious the party was in its criticism. “I cannot help thinking that they are hoping for these things to happen as the only way they might get back into office,” said Mr Holland. Mr Holland said that health and social security expenditure had increased from £142 million to £195.4 million in the last six years. The current expendituie on health, including health benefits, was £80.2 million and on social security £115.2 million.

The annual net expenditure on education, he said increased from £43 million to £77.2 million in the last six years and spending on education buildings from £8.7 mil lion to £14.2 million in the same period. “This doesn’t sound like a government trying to dismantle something in which they believe,” said Mr Holland. Mr Holland said that Mr Kirk had claimed that the Government had clouded the issue last November on the Vietnam question. “I think it is time Mr Kirk realised that the people of New Zealand value highly the security of our country, that they approve the Government’s actions in entering into collective security arrangements with our friends and allies, and even more they approve of our actions in going to the aid of our friends when they call for help.

Mr Holland said he believed there was a very wide division of opinion in the Labour Party on this subject “There is no doubt that the present attitude was dictated to them by the Federation of Labour.”

We faced today problems which, if they were to be overcome, required measures which were unpleasant both to administer and to take, said Mr Holland. No party liked controls and restrictions less than the National Party.

Labour criticism had been either uninformed or deliberately confusing,” he said.

For instance Labour had complained about the size of our public debt. They had not said that a Labour Government would reduce public debt, or borrow less. “Therefore their complaints have an air of unreality about them. “Every economist will agree that it is not the size of the public debt that matters but the way in which it is invested. To the extent that loans are reinvested in capital projects which yield an annual return sufficient to meet the costs of servicing the debt, obviously there is no burden at all on the taxpayer,” said Mr Holland.

Our total public debt, in March of last year, was £ll2B million. The sum of £617 million—more than half—was

reinvested at rates that showed a profit. It was invested in capital works, which earned full interest at 4} per cent a year—electric power, post office, land development, State Advances Corporation, Tasman Pulp and Paper Company, and so on. “All of it is helping to build New Zealand and all of it is good business for the taxpayer,” he said. The sum of £l3l million of our public debt was invested in projects which earned interest but not at the full rate. All of that sum was in 3 per cent housing loans. Presumably the Labour Party had no complaint on that score. Last year they said they would borrow more and lend much more, at 3 per cent.

“So their whole criticism falls down and they know it,” said Mr Holland. “The sum of £309 million of our national debt did not earn interest, although it was represented by worth-while permanent assets or development works—airport development, education buildings, state forests, state coal mines, railways, roads and highways, and so on. “I cannot recall a single instance of the Labour Party advocating that expenditure on such projects should be curtailed; I cannot recall a single instance of any Labour Party member advocating that works of this nature should be financed solely through taxation. “Labour is putting up a sham fight and they know it,” Mr Holland said. “Nearly £7O million of our public debt was wholly nonproductive. Of this sum, £56 million was incurred by the first Labour Government—£36 million for the 1939-45 war loans, and £2O million for the Reserve Bank exchange adjustment made in 1948. The remainder, £l3 million, represented new loan money in hand as at March of last year—money borrowed but not used up to that time.”

Mr Holland said that National’s borrowing programme had been reasonable and moderate. “The Labour Party says otherwise, but only for the purpose of making political capital out of the matter.”