MR MULDOON ‘FLIPPED LID’ – MR ROWLING

Press, Volume CXV, Issue 34031, 20 December 1975, Page 1

MR MULDOON ‘FLIPPED LID’ - MR ROWLING

(New Zealand Press Association) WELLINGTON, December 19. The Leader of the Opposition (Mr Rowling) says the Prime Minister (Mr Muldoon) has “flipped” his lid. and the president of the Federation of Labour (Mr Skinner) has predicted serious unemployment, as criticism pours in of yesterday’s big Government price increases.

Mr Rowling, spearheading a conceited Opposition attack on the new Government’s economic package, said Mr Muldoon had shown he had no intention of maintaining full employment.

He said the size of the increases showed that National was looking for revenue to finance its election promises.

“Mr Muldoon does not seem to have a grip of the situation,” Mr Rowling said. “He is adopting the same policy as when he introduced a series of miniBudgets when he was Rjinister of Finance in 1967-68 in an effort to bolster the economy.”

Mr Skinner said in Auckland that the package’s effect could be "a very serious recession.” ’Old method’

He said that, as usual, it was a case of the business community’s being allowed to pass on price increases and the worker’s having to pay.

“It’s much too severe,” he said. “It’s the old method of trying to fix inflation which has failed in every country in the world. Elsewhere, it has led to a very serious problem of unemployment.”

| The F.O.L. would seek “substantial” wage rises to cope with the increased cost of living. Its national executive would meet in February to work out how much would be needed. “It seems that the business community is going to be allowed to pass the full increases on to the public. There has been no effective price control in New Zealand for the last few years.” Pensioners There was a good case for the Government to announce increases in pensions at the same time as it outlined the other increases.

“If they do not there will be very serious hardship for those on fixed incomes.” The former Minister of Finance, Mr R. J. Tizard, said the increases would take more than s22om out of private-sector spending, further push wages behind the cost of living, and put people out of work. The lowest-paid worker would be the hardest hit.

“With these savage charge increases under his belt, there is no wonder the Prime Minister can agree with the O.E.C.D. predictions that New Zealand will have the highest inflation rate of the world’s 24 major industrialised coun-

tries next year,” Mr Tizard said. “He is making it a selffulfilling prophecy by his own brand of economic mayhem.” ‘Nonsense’ The former Minister of Labour, Mr A. J. Faulkner, said the average family man would need to earn another $8 a week before tax to pay for the increases. The Government had "made nonsense of calls for belt-tightening.”

The former PostmasterGeneral, Mr F. M. Colman, said the new Post Office charges were “completely unjustifiable ... possibly to pay for the extravagant policies of the National Party.” Other reactions:

Mr A. L. LAIDLAW, president of the Manufacturers’ Federation: The measures would further boost inflation, depress demand, and hit production growth, jobs, and industry and business in general. “Having taken its medicine, the economy should now be nursed back to health and strength with measures to stimulate production growth in our factories and on our farms.”

Mr A. JOLLY, president of the Associated Chambers of Commerce: Reality hurt, but it had been completely unrealistic to keep charges pegged for three years while contributing costs rose. “The increases will mean an additional load on net profit, which will be maintained only if the Minister of Finance succeeds in diverting spending from the public sector into the private sector, which is already being strangled by lack of profitability.” Mr I. REDDISH, chairman, of the Combined State Service Organisations: “I am

absolutely shocked at the extent of the increase. I am very, very fearful of their effect on the lower-income family groups.” The increases would considerably alter the C.S.S.O.’s attitude to the cost-of-living order. Mr W. R. STOREY, senior vice-president of Waikato Federated Farmers: Relief that New Zealanders were being asked to “face up to reality” and emerge from a “fool’s paradise.”