Govt has failed—Mr McLay

Press, 14 January 1986, Page 5

Govt has failed—Mr McLay

PA Wellington The Government has failed to solve the interest rate problem affecting farmers, businessmen and homeowners, said the Leader of the Opposition, Mr McLay, from Honolulu yesterday. “They will continue to pay high interest rates, month after month, under Labour,” Mr McLay said. He was commenting on the state of the nation address by the Prime Minister, Mr Lange, to the Whakatane West Rotary Club yesterday. In his speech Mr Lange said inflationary pressures and the measures to deal with them would mean high interest rates in the short run.

“After 12 months of promising that interest rates would drop and failing to deliver on that promise, the Prime Minister is back in the business of saying next year they’ll come down,” Mr McLay said. Mr Lange’s message was one of despair for people in all sectors of the economy, he said.

Mr McLay said the speech offered no hope for tnose facing severe financial hardship, including those who the Reserve Bank said would have to live off savings this year. “His message of doom and gloom is even more harsh than his speech at this time last year,” Mr McLay said.

“The Prime Minister’s acknowledgement that things

will get worse this year before they get better is a blatant admission that his Government has failed.

“It gives a hollow ring to all his rosy promises of 1985 that things will get better next year.” Mr McLay said 1986 would certainly be a bleak year for New Zealanders and Mr Lange would have to take the blame “fairly and squarely on his own shoulders.”

“He cannot go on blaming past Governments for ever. In 18 months of government all he has managed to do is make things worse. That represents failure, not achievement,” Mr McLay said.

Speaking from Manapouri, the Deputy Leader of the Opposition, Mr Bolger,

said the economy was now tumbling into deep recession.

“What the public wants from Mr Lange is not forecasts of depression but some indication of how his Government intends to correct the economic crisis it has created,” Mr Bolger said.

Mr Peter Elworthy, president of Federated Farmers, said the Prime Minister “acknowledges again that strains from the economic changes have been especially harsh on the farm sector.

“He acknowledges that the economic measures which have affected farmers have yet to start to bite on other sectors. He also rightly says that farmers have a right to

expect evenness of action,” Mr Elworthy said.

“We now call on the Prime Minister to fulfil that expectation. “Mr Lange suggests unemployment will be worse in rural and provincial areas than in cities. The federation has been issuing warnings for months that a downturn in farm spending means less business and fewer jobs. “Unions, which have negotiated large wage increases, and managements which have agreed to them, cannot now say they were not warned of the consequences. “Unlike Mr Lange, the federation believes the effect of the farm economic problems will extend soon into cities as well as rural areas,” Mr Elworthy said.