‘Public want the freeze'

Press, 21 July 1982, Page 6

‘Public want the freeze '

PA Wellington The Prime . Minister (Mr Muldoon) yesterday asserted the, support of. New Zealanders for the wage and price freeze. Defending the measure as it came under Opposition fire during a snap debate in Parliament, Mr Muldoon said that the freeze would be effective by squeezing out inflation and the inflationary expectation:-that had businesses planning for high wages' in a ."self-fulfilling prophecy.” "The people want this thing and they want it to succeed,” Mr Muldoon said. The Opposition had earlier forced a snap debate on the freeze. Labour’s spokesman on finance, Mr R. J. Tizard, said that people could see -that the measure was a "stunt.” The freeze was interference “in the way that only fascist Governments

have done in the past,” he said. But Mr Muldoon said that the freeze * was part of a package planned for the Budget.

“In the Budget, we are going to have in essence a wage-tax trade-off, we are going to have a wage freeze, we are going to have some tax deductions to compensate, but we are putting in an extra ingredient ... that is a price freeze.” Mr Muldoon said there would be some increases in the next three months in spite of, the freeze — “that is why we will have tax deductions to offset them.” Mr Tizard described the freeze as the most drastic act of intervention by any National Government. It hit hardest those at the bottom end of the salary scale, and many employers were refusing to negotiate the coming

year's wage round, in spite ot seeking approval' for increases in their own directors’ fees.

“They will not negotiate while the freeze is on, but they will prepare to adjust their own incomes while the freeze is on to make sure it is applicable the day the freeze is off,” Mr Tizard said.

The • price freeze was not working. It had not even lasted two days. Since it was enacted, 154 price rises had occurred, he said. Mr Tizard called on a former Cabinet Minister, Mr D. F. Quigley, to abstain from voting on a motion of no-confidence in the Government because of the freeze. The Leader of the Opposition (Mr Rowling), said that the country would hear a great .‘deal of “bluster and threat” from the Government in the weeks to come, but it would db nothing to make the freeze work. Wages

were already lagging behind inflation, and while the Government had allowed hardship provisions for companies to increase prices, there were no hardship provisions for those they employed.

The whole exercise, he said, was “a backdoor way of reducing the living standards of the working people of this country.".

Mr Rowling was supported by Mr D. F. Caygill, who called the restraints "a nonsense and a disaster.”

The country had become “addicted to inflation” in the last few years and the Government did not realise that in making the nation go “cold turkey” it could end up killing the patient, he said. Defending the freeze, Government Ministers blamed the Federation of Labour for refusing to negotiate a wagetax trade-off.