Rewards For Efforts In N.Z.

Press, Volume CVII, Issue 31499, 13 October 1967, Page 16

Rewards For Efforts In N.Z.

“Is New Zealand the sort of place where professional effort, provided it is well directed, will yield a sense of accomplishment without unnecessary difficulties and frustrations?” asked Professor F. M. Henderson in his presidential address to the Engineering Society of the University of Canterbury.

For a direct answer, he said, one might look at the degree of skill and intelligence in the day-to-day operations of the country. For a more indirect but quite informative answer one might ask how the professional middle class was regarded in this country. The first and most obvious evidence was in professional salaries, professor Hender-

son said the salary of the “foremost hired professional manager” in New Zealand—the . Prime Minister—was $14,700, compared with $31,250 in Australia and $28,000 in the United Kingdom (all figures in New Zealand currency and including expenses). Another clue was in the structure of personal income tax. “It is clear,” he .said, “that New Zealand has the most steeply-rising tax rates (compared with Australia, the United Kingdom, and the United States) so that the young man forging ahead feels the tax collector’s bite earlier in his career in New Zealand than in other countries.” Recent Australian university increases put gross salaries one academic rank ahead of New Zealand, but the differing tax rates had the effect of nearly two ranks. Some Australian senior lecturers would have a net salary greater than some New Zealand professors, said Professor Henderson. It seemed unfair, Professor

Henderson said, that in New Zealand so much of the tax burden should fall on assessable incomes between $2OOO and $BOOO. It was in this range that the salaried professsional man could expect to find rewards for his lifetime of effort and heavy responsibility. In the result, the tax gatherer would take nearly half the amount by which his salary rose and two-thirds of any further increase he might acquire. But dividends on company shares—unearned income by anyone’s definition —were taxed at a flat 35 per cent

Professor Henderson, who spoke extensively on tax rates and used a comparative graph, said the structure “reflects New Zealand’s rooted scepticism about the value of professional effort and about the possibility of really earning large sums of money.” This in turn stemmed from the belief that a job was not a means of accomplishing certain results but a commodity ■to which everyone was en-

titled so that he could acquire the means of keeping alive, said Professor Henderson. This “entitlement” arose not from the individual’s ability to do the job but from his need for a livelihood.

An example was the recent clamour about some persons holding two jobs while others were unemployed. "Those who are protesting seem quite indifferent to whether the person unemployed is capable of doing the job in questinon; the first should give one of his two loaves to the other.” In this respect the New Zealand attitude could be described as communist rather than socialist, probably more so than that of any other country in the world with the possible exception of China.

Professor Henderson said that during a year at an American university he increased his basic salary by 62 per cent through energetic research and consulting. At home the reward would have been a fraction. The money was pleasant, but more important was the stimulation of reward for effort